NEWS ARTICLE

Avoid the two common errors on last year’s Annual Return

Council Tax Support Grant, which we still receive, does not form part of the precept. It is a grant and should be included in the ‘Other Receipts’ box.

Valuing Fixed Assets (Box 9 of the Annual Return).

Most councils are expected to continue to value fixed assets at purchase cost unless a purchase took place some time ago and the cost is unknown in which case insurance cost is a reasonable proxy. However, ‘Governance & Accountability 2016’ gives Councils the flexibility to approve a change in accounting policy, if they wish to, in order to revalue assets at 31/3/17 on any “reasonable” basis. The External Auditor’s understanding is that this must be formally approved by the Council and once done the new basis must be followed consistently from year to year with the 2015/2016 comparator restated so assets are shown on a consistent basis. There is still some uncertainty over whether or not councils are now entitled to depreciate assets or periodically revalue them as the new guidance is contradictory on this. Mazars say they have fed back their concerns on this lack of clarity. However, in summary unless you especially want to change your fixed asset basis the change has no impact and you do not need to worry about it.

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