Agenda item

Consider report by Director – Finance and Procurement. (Copy attached.)

There had been circulated copies of a report by the Director – Finance and Procurement which his report provided the details of the income and expenditure for the Selkirk Common Good Fund for the three months to 30 June 2023, a full year projected out-turn for 2023/24, and projected balance sheet values as at 31 March 2024.  Appendix 1 to the report provided the projected income and expenditure position for 2023/24.  That showed a projected deficit of £2,763 for the year, which was less than the previously reported surplus on 7 June 2023, as a result of an increase in the property repairs budget.  Appendix 2 to the report provided a projected balance sheet value as at 31 March 2024. It shows a projected decrease in reserves of £142,039.  A breakdown of the property portfolio showing projected rental income and projected net return for 2023/24 and actual property income to 30 June 2023 was provided in Appendix 3a to the report.  Appendix 3b provided a breakdown of the property portfolio showing projected property expenditure for 2023/24 and actual property expenditure to 30 June 2023.  A breakdown of the property portfolio showing projected property valuations at 31 March 2024 was provided in Appendix 4 to the report. Appendix 5 showed the value of the Aegon Asset Management Investment Fund to 30 June 2023.  The Statutory Accountant, Mr Gordon Reid, presented the report and responded to questions.   Mr Reid highlighted that because the tenant had withdrawn their offer to lease 28 Market Place there would be an impact associated with the loss of rental income.   The Estates Surveyor, Ms Tricia Hill, confirmed that the works to refurbish 28 Market Place had proceeded as agreed.  With regard to the revaluation reserve, Mr Reid explained that it was hoped that the works to refurbish 28 Market Place would offset depreciation.  In response to a question regarding the depreciation associated with the caretakers flat at Victoria Hall, Mr Reid undertook to explore the issue with Estates and ensure that an update was provided at a future meeting.   Mr Reid explained that he was attending the meeting as part of an interim arrangement and confirmed that he would raise displaying the value of fixed assets with his successor. It was highlighted that insurance arrangements for assets remained unclear and that it was of paramount importance that photographs, and full documentation of fixed assets should be in place to cover assets in the event of fire, theft, or loss of any description.  Mr Reid undertook to explore the insurance of assets, including the thoroughness of their valuation and whether appropriate documentation and evidence of their condition was in place.  In response to a question regarding the valuation and depreciation of farms, Mr Reid explained that the depreciation referred to was based on the likely lifespan of buildings.  The land holdings were not depreciating in value.  The revaluation referred to in the report was carried out every five years, and it was possible that there could be a significant uplift in the value of individual farms once that exercise was undertaken. 

DECISION

(a)            AGREED:-

(i)             that the Statutory Accountant would investigate the depreciation charges associated with the Caretakers Flat at Victoria Hall with the Estates Department;

(ii)           that the Statutory Accountant would investigate providing fixed asset values as part of future reports; and

(iii)          that the Statutory Accountant would explore whether appropriate photographic evidence and documentation of assets existed for insurance purposes, and whether insurance arrangements in place were sufficiently thorough to afford the appropriate level of protection from fire, theft, and loss.

(b)        NOTED:-

(i)         the actual income and expenditure for 2023/24 in Appendix 1 to the report as the revised budget for 2023/24;

(ii)        the projected balance sheet value as at 31 March 2024 in Appendix 2 to the report; and

(iii)       the summary of the property portfolio in Appendices 3 and 4 to the report; and

(iv)       the current position of the Aegon Asset Management Investment Fund in Appendix 5 to the report