Tag Archives: accounting

Who knew that Faster Closure of Local Government Accounts would benefit front line service provision?

How can faster closure of local government accounts improve public services? Ena Lloyd examines what we can learn from English Local Authorities.

Faster closure of local government accountsCurrently, Local Government Accounts have to be signed off by 30 September in Wales. The Treasury in Whitehall would like to enable the Whole of Government Accounts to be made available by that date, and so there is every likelihood that the sign off date is going to move forward to 30 July in a few years’ time.

I’ve been chatting to a number of Local Authorities across England where they have already brought the date forward of Faster Closure of Local Government accounts, to hear their thoughts on their approaches. There seem to be three themes emerging from the discussions:

Technology

The reality is, technology has evolved, and by now it’s reasonable to expect that most financial processes are automated. So, at worst, ‘ faster closure’ can be seen as an opportunity to review current financial systems. Supporting financial teams to work smarter, not harder. Also it’s a great opportunity to pause and reflect to think about building in resilience into the process too.

The Band Aid Approach

The opening thoughts seemed to have a clear theme: there is no hiding from the fact that change is tough. Especially, when financial colleagues have been used to the same processes and worked to the same timescales for a number of years. It’s understandable. I can hear the argument that, if it’s not broken…………..

The idea of change was worse than the reality. That may sound rather a glib comment to make. Many reflected on the fact many financial colleagues spent more than half of their working year on ‘closing down the accounts’. The impact of this on colleagues left them feeling as if they were working in the past and in a kind of bubble too.

The benefit of ‘faster closure’ for financial staff is that they spend far less time focusing on the past, and, given that I work for the Wales Audit Office, I say the next bit with a smile on my face, the external audit is over much quicker. The relationship with the external auditor has changed in that they are involved much more in year, sharing their thinking and potential changes. Adopting a ‘no surprises approach’.

Benefits Realisation

Probably the biggest benefit of ‘faster closure’ is the improved service financial colleagues now provide front line services. They are able to devote far more time to budget setting and monitoring. More importantly, by engaging at a much earlier stage with Service Managers about what management information they need to run their service, can only be of benefit to public services.

And isn’t that what it’s all about at the end of the day?

Accounting against the Clock

Faster Closure of accounts in Wales – are we all up for the challenge?

Accounting

The Good Practice Exchange will shortly be holding two Faster Closing seminars in Cardiff and North Wales. John Herniman from our Senior Leadership Team shares his views on Faster Closing and what it means for Wales.

We’ve heard a lot in recent months about the faster closing of accounts. In England, both Oldham and Westminster Councils beat their previous records for closing their accounts, doing so by the end of May. Closer to home, Torfaen County Borough Council closed its 2014/15 accounts in record time, 10 weeks ahead of the deadline. There is also the continued pressure to speed up the publication of the annual Whole of Government Accounts into which Local Government bodies accounts are consolidated.

As we all know, the current deadlines for the production and audit of Local Government bodies’ accounts are 30 June and 30 September respectively. The Welsh Government has recently consulted on bringing these dates forward to 31 May and 31 July over the next few years. Whilst the earlier deadlines may seem like a distant challenge not to be concerned about just yet, the scale of the changes required for practitioners and auditors alike means that planning needs to start now.

What are the benefits?

As daunting as it might seem, we know that there are many benefits of faster closure. These include, but are not limited to, improving the timeliness of reporting to stakeholders and having earlier assurance over the previous year’s position before embarking on major financial decisions for the future. The private sector and other parts of the public sector all close their accounts earlier so the question for me is ‘Where do we start?’

Faster Closure in Wales

Our Good Practice Exchange seminars in October and November will give us insight into how particular organisations started their journey. These seminars are not going to be focused on detailed processes but rather the organisational and cultural changes needed to start the journey. Further seminars and workshops will be held over the coming years exploring the more detailed aspects of faster closing.

The organisations involved will share with us their approaches and most importantly, the lessons learnt from achieving earlier closure of accounts. For me personally, hearing about the challenges that they faced at the early stages and how they overcame them will be of particular interest

A new challenge

There is no doubt that the faster closing agenda will bring major challenges for both practitioners and auditors as we work together to develop and learn from new ways of working. I remember the last time the closure dates were brought forward, from the end of December to September. Back then that sounded impossible but it quickly became the norm with the tighter deadlines being achieved.

Faster closure is a learning curve for all of us; insights from Torfaen, Oldham, Kent and Westminster will provide us all with a chance to be working from the same page so that we have a good starting point as we embark on their faster closing journey.