The CIPFA/LASAAC Local Authority Code Board today agreed to seek to replace the 2019/20 Accounting Code with simplified version in order the ease the burden on practitioners as they respond to the ongoing coronavirus (COVID-19) emergency.
In a joint statement, Rob Whiteman, CIPFA CEO, and Conrad Hall, Chair of CIPFA/LASAAC, said:
“As the UK response to the COVID-19 crisis continues, it is already clear that scarce finance and departmental resources in local government have been diverted from normal financial management and reporting duties and are being deployed to assist and support frontline services.
“The immediate milestone of course is the preparation of the financial statements for 2019/20. Realistically, the level of resources that are available to prepare financial statements will either not be available or, at best, be severely depleted.
“We have recognised that the requirement to fully prepare financial statements at this time is not tenable. A radical solution is required to maintain the integrity of the accountability framework while relieving the burden on finance professionals.
“The CIPFA/LASAAC Code Board therefore proposes, extraordinarily, to suspend the requirement to apply the Code of Accounting Practice for 2019/20 in its current format. This will be substituted with a forthcoming Code update which will set out a radically reduced (or simplified) set of financial statements.
“This proposal will be subject to approval from the Financial Reporting Advisory Board and we are liaising urgently with the Financial Reporting Council, representatives of the audit profession, the Ministry of Housing, Communities and Local Government and representatives of the devolved administrations for the required approvals.
“We are therefore, in a short space of time, exploring how the revised statements can account for the general fund, collection fund, Housing Revenue Account balance and present a limited balance sheet. We hope to reveal our proposals in detail in early April.”
For further information please contact the CIPFA press office on T: 020 7543 5647 or E: email@example.com
Notes to Editors:
The CIPFA/LASAAC Local Authority Code Board is responsible for preparing, maintaining, developing and issuing the Code of Practice on Local Authority Accounting for the United Kingdom.
CIPFA, the Chartered Institute of Public Finance and Accountancy, is the professional body for people in public finance. CIPFA shows the way in public finance globally, standing up for sound public financial management and good governance around the world as the leading commentator on managing and accounting for public money.