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Agenda item
Foreshore Trust Finance Report
- Meeting of Charity Committee, Monday, 17th June, 2019 6.00 pm (Item 30.)
- View the background to item 30.
Minutes:
The Assistant Director, Financial Services and Revenues submitted a report to advise members of the Committee on the current year's financial position (2019/20).
The report was presented to the Committee by the Chief Accountant.
The budget agreed in March 2019 identified budgeted income at £1,477,000 and expenditure at £1,296,000. The budgeted operating surplus for the year being £181,000 after direct governance costs, but before distribution of grants, capital charges and before use of Reserves.
Income is currently projected to be below budget by a small amount. The amount of rental income anticipated is now £10,000 less than budgeted for due to void lets taking longer to fill. Investment income and car parking income remain on budget.
Expenditure is expected to be £6,000 below budget. This is due to anticipated £6,000 lower than budgeted maintenance expenditure as the £12,000 per annum put aside for maintaining and operating a water play feature (the White Rock Fountain) will not be incurred in full this financial year.
The combination of the reduced income offset by the lower expenditure will give rise to a net £4,000 increase in the anticipated deficit at the year end. This is now forecast to be £201,000.
Paragraph 10 of the report should read ‘The combination of the above variances’, not underspends.
Responding to a query raised at the Coastal Users’ Group meeting as to why a budget deficit is being planned the Chief Accountant informed the Committee that whilst the Foreshore Trust generates an operating surplus before grants and project costs, once these items are deducted then either a surplus or deficit is made, which is either transferred to or taken out of reserves. The timing of projects and maintenance expenditure can therefore have a material effect on whether an annual surplus or deficit is generated and the timing of these items can vary for a number of reasons. The Chief Accountant also reminded the Committee that as a charity the Trust cannot hold large reserves without them being for a specific purpose. Therefore on occasions the Trust has to run a deficit to utilise its reserves to fund expenditure to meet its charitable purpose.
It was noted that the Coastal Users’ Group did not endorse the report as they only received it on the day of the meeting. The Chief Accountant apologised on behalf of the finance team for late submission of the financial report.
The Committee thanked the finance team for their work.
Councillor Batsford proposed a motion to approve the recommendations in the report, seconded by Councillor Rogers.
RESOLVED (unanimously):
To agree the current financial position for 2019/20.
Reasons for the recommendations:
The Council has the responsibility for the proper management of the financial affairs of the Trust. In doing so it complies with Accounting Codes of Practice and the high standards required for the accounting of Public money.
A deficit slightly above budget expectations is anticipated for 2019/20 in respect of operating income and expenses. Once grant and project costs are taken into account an increased deficit of £201,000 is anticipated against a budgeted deficit of £197,000.
Supporting documents:
- Foreshore Trust Finance Report 17.06.2019, item 30. PDF 120 KB
- FST Monitoring June 2019 - Appendicies 1, 2 & 3.xlsx, item 30. PDF 23 KB
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