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Another year-end is done and dusted in local government, for draft accounts at least. So how did it go? Hopefully you met any deadline you set yourself to get the accounts signed before 30 June in anticipation of 2017/18 deadlines.
A few questions to ask yourself while it is fresh in your mind:
If you find yourself answering 'no' to any of these questions then you are not alone, but there is support out there.
We have just finished the third year of accounting for the 50% business rates retention system and are heading towards the introduction of a 100% retention system, whatever this may look like in its final form. Both systems are focused on the growth in business rates that authorities can generate and keep to a lesser or greater extent.
Council tax used to be the ‘balancing figure’ of local authority funding and although it is still an important source of income, business rates are now the source that influences and can be influenced by local authority accounting and funding. Therefore without a solid understanding of what can and should be included in your budgets and outturn figures for both sources, this could mean that you are missing out and are open to potential surpluses and deficits that you didn’t anticipate.
CIPFA is committed to helping authorities deal with the accounting and budgeting complexities of the collection fund. This year it has supplemented the updated collection fund accounting models with a Rough Guide to Collection Fund Accounting and a variety of remote and on-site support and reviews of the accounting and budgeting positions. This is as near as we can get at the moment to collection fund in a push of a button – or at least a few pushes. Our support can give you peace of mind quickly that you have got your collection fund, general fund and balance sheet position right for council tax and business rates. (One feedback email I received on council tax was “less than four hours – a new all-time best”.)
Feedback on the Rough Guide has been very positive, showing that it has been and will be really useful in building and consolidating collection fund knowledge within local authorities. What the support reviews have unearthed is that the answer to those questions I asked above wasn’t always yes. For example, revenues systems couldn’t be reconciled to net council tax/business rates payable; NNDR 3 Part 5 opening and closing balances couldn’t be matched to model and ledger; and inefficient ledger configurations are meaning transactions are being posted and re-posted, none of which supports strong financial management or quicker closedown. What is positive is that those authorities we helped are all in a better position now to be confident that this time next year the answer to those questions will be 'yes'.