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Statement of Accounts Scarborough Borough Council Core Single Entity Statement of Accounts 2015 – 2016 Scarborough Borough Council Statement of Accounts 2015/16 Contents 2015/16 Chief Finance Officers Narrative Report 3 Statement of Responsibilities for the Statement of Accounts 21 Annual Governance Statement 22 Core Single Entity Financial Statements Comprehensive Income and Expenditure Account 33 Movement in Reserves Statement 34 Balance Sheet 36 Cash Flow Statement 37 Notes to the Core Financial Statements 38 Collection Fund 116 Independent Auditor’s Report 119 Glossary of Terms 121 2 Scarborough Borough Council Statement of Accounts 2015/16 CHIEF FINANCE OFFICERS NARRATIVE REPORT 2015/16 INTRODUCTION The following pages introduce the Borough Council’s Statement of Accounts for the year ended 31 March 2016. The published accounts are an important element in demonstrating the Council’s stewardship of public money, showing the resources available and how they are used to deliver everyday services to the community. The purpose of this Narrative Report is to provide an explanation in overall terms of the Council’s financial position, including the major influences affecting the accounts, and to assist in the interpretation of the accounting statements. OVERVIEW FROM THE RESPONSIBLE FINANCE OFFICER As the Council’s statutory officer responsible for Finance, I have pleasure in writing this explanatory overview to the Statement of Accounts for 2015/16. My key priorities are: . To maintain sound financial management practices across the Council, . To ensure that financial resources are spent in line with the Council’s priorities, . Ensuring Value for Money, and . To make financial reporting meaningful for everyone. The Council’s External Auditors, Mazars LLP, inspect and assess how the Council manages its resources and its arrangements for financial management. The audit report prepared by Mazars for the year ended 31 March 2015 concluded that the auditors were satisfied that in all significant respects, the Council had proper arrangements in place to secure economy, efficiency and effectiveness in its use of resources. In line with most other public sector organisations the Council continues to suffer from significant cuts in Central Government funding due to the Government’s strategy to reduce the Country’s budget deficit. Funding announcements on Government cutbacks have not come as a major shock to the Council; they have been anticipated, and positive actions have been put in place to ensure that where possible the Council reduces its budget in a controlled and managed way, without the need to cut front line services. The 2015/16 budget required the Council to make savings of £2.9m, followed by a further £1.8m in 2016/17 and a minimum of £2.3m in 2017/18 (£7.0m over 3 years). Public sector funding reductions will continue over the medium to long term and this is factored into the Council’s future funding models. Although the Council strives to deliver budgetary savings through efficiencies rather than cuts in service this is becoming increasingly difficult as the cumulative impact of funding cuts takes effect. The Council will consider a range of options to ensure that we continue to provide customer- focused, efficient services. 3 Scarborough Borough Council Statement of Accounts 2015/16 CHIEF FINANCE OFFICERS NARRATIVE REPORT 2015/16 It is pleasing to report that despite the requirement to make significant savings in recent years the Council’s prudent approach to budget management and control has resulted in a year-end underspend of £765k against this year’s revenue budget. In addition to this, the levels of corporate reserves have been maintained within the optimum ranges set out in the Financial Strategy. Despite the economic conditions the Council continues to deliver an ambitious regeneration programme across the Borough, and the Council continues to provide support to progress the wider aspects of the Sands (including the Waterpark development), Middle Deepdale, Leisure Village, Futurist Redevelopment and the regeneration of Scarborough Indoor Market. These major schemes demonstrate the Borough’s commitment to working in partnership, improving economic prospects and encouraging enterprise in the region. I hope this Statement of Accounts helps you to better understand the Council’s financial position. Please let me know how you think we are progressing with our financial reporting, as we are aiming to continuously improve in this area. Nick Edwards C.P.F.A. Director (Section 151 officer) 4 Scarborough Borough Council Statement of Accounts 2015/16 CHIEF FINANCE OFFICERS NARRATIVE REPORT 2015/16 OUR VISION AND MISSION Our Vision / mission Statement is ‘Towards a prosperous borough, with a high quality of life for all’. We will achieve this through our four key aims: • People • Place • Prosperity • Council Our aims are linked to and impact on one another in complex ways. Many of the actions we are undertaking link to more than one of our aims and improvement in one area often depends upon success in one or more of the others. The Council’s Annual Report sets out what we have achieved over the last year and our plans for the next 12 months in relation to each of our aims. We have set targets so that we are able to assess whether or not they have been met. Each service in the Council is required to set out the improvement actions they are carrying out to assist in the delivery of the Corporate Plan priorities on an annual basis. These actions are called Critical Success Factors (CSFs), and consist of Performance Indicators and delivery measures relating to projects. In all cases the actions seek to achieve continued year on year improvement. Details of actions which will contribute to the delivery of the Corporate Plan are set out under each priority, under the heading 'Improvement Actions'. The following graph shows details of progress against our Critical Success Factors during 2015/16: CSF Outturns 2015/16: not completed 8% completed in part 19% Completed in full 73% Further details of the Council’s achievements over the last year can be found on our website at: http://www.scarborough.gov.uk/home/open-data-and-foi/performance The Annual Report and Improvement Plan (ARIP) for 2016-17 were presented to Cabinet on 13 September 2016. 5 Scarborough Borough Council Statement of Accounts 2015/16 CHIEF FINANCE OFFICERS NARRATIVE REPORT 2015/16 OUR PERFORMANCE The Council operates a corporate Performance Management Framework (PMF) which is used to monitor and manage the performance of its Services. A range of performance indicators are maintained by each Service and are used to measure progress of our aims and key priorities as detailed in the Corporate Plan. This report contains three types of measures: ‘Quality of Life’ Indicators - These PIs have been identified to supplement the range of performance information measured and monitored by the Council. The ‘Quality of Life’ Indicators provide contextual information about life in the Borough, but no targets are set as progress is affected by a wide range of factors and organisations and is therefore not directly in the Council’s control. These measures include life expectancies, overall crime rates, employment rates, average wage rates, etc. Scarborough Borough measurements will be compared to the average for all districts, with history showing direction of travel, and progress will be reviewed annually and reported in the ARIP. Service Performance Indicators - these PIs are those which directly measure the performance of the Council’s services, such as processing times for benefits claims, planning applications, etc. Targets for these indicators are set – these are the indicators which are regularly monitored and results of the monitoring presented to Cabinet on a quarterly basis. Critical Success Factors – these are measures related to key projects and actions undertaken by the Council’s services, which assist in delivering the Corporate Plan. Targets are set and CSFs are monitored, with results being reported to Cabinet on a six-monthly basis. Tables detailing the Council's performance against its Service Performance Indicators and Critical Success Factors are shown in the Annual Report and Improvement Plan under each of the Council’s Aims. This allows you to monitor our performance against these aims. The results show areas where performance has improved and those areas where performance is lower when compared to the previous 12 months. In some cases, whilst there has been a drop in performance, the level of performance achieved is still above the target set by the Council. The year-end figures for 2015/16 show that we have improved in 54% of the Priority Indicators where it is possible to make an assessment. In addition the performance of 4% of indicators has remained at the same level. We have met our targets for 66% of our indicators. We want to build on this over the next year, continuing to improve the quality and performance of our services, against a background where we are required to make significant savings in our budgets. 6 Scarborough Borough Council Statement of Accounts 2015/16 CHIEF FINANCE OFFICERS NARRATIVE REPORT 2015/16 The following graphs show our Direction of Travel against the Priority Performance Indicators for 2015/16, and whether or not we achieved our targets. THE STATEMENTS The Statement of Accounts has been prepared in accordance with the 2015/16 Code of Practice on Local Authority Accounting in the United Kingdom: A Statement of Recommended Practice (hereafter referred to as the SORP) published by the Chartered Institute of Public Finance and Accountancy (CIPFA). The aim is to ensure consistent treatment and comparability with the accounts of other local authorities. The statements included in the accounts are as follows: - The Statement of Responsibilities for the Statement of Accounts sets out the Authority’s and Chief Finance Officer’s legal and professional responsibilities for the accounts under Local Government Legislation.
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