Addressing misleading reports on The Civic Hall's finances
Published on Wednesday, 24th July 2019
In response to various misleading reports in the press and on social media, the Borough Council wishes to clarify a number of issues regarding the financial operation of The Civic Hall in Bedworth.
The Civic Hall budget figures reported to Cabinet this month made reference to an overspend variance of £69,000 for the Civic Hall. This included an increase of £69,000 in the notional capital charges for depreciation made to the service – this was simply because the market value of the Civic Hall building had increased, and this had to be reflected in the accounts. From an accounting perspective, the capital charges are non-controllable and are processed at the end of the financial year. Furthermore, they can vary significantly each year according to the value of property, which in turn is governed by external market forces. The full Cabinet and OSP reports make it clear that this capital variance has no impact on revenue balances, so this £69,000 is in no way a cash overspend to the Council.
If the non-controllable, notional capital charges are excluded, then the Civic Hall’s 2018/19 accounts were balanced to the approved budget (i.e. nil variance).
Cllr Ian Lloyd, portfolio holder for Arts and Leisure said:
“The Borough Council is well known for its excellent financial management and our accounts are signed off each year by our external auditor.
“Our finances are complex in some areas, as must be expected for a large organisation providing many different services – I am pleased that most people appreciate this, but where there is any misunderstanding it is important to clarify things quickly. Misunderstandings can be damaging in commercial terms and demoralising for staff.
“I wish to stress that the routine accounting adjustment that has been made in this instance is a paper transaction rather than a cash one, and of no cost to council tax payers.”
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