For councils with a gross income or expenditure of over £200k for three consecutive years there is a requirement for their end of year accounts to be prepared on an income and expenditure basis. It is optional for smaller councils.
Within the year itself the accounts can be done on a Receipts and Payments basis with a conversion to Income and Expenditure just for the Annual Statement and associated reports.
1. Complete your Data Entry
Enter all transactions up to and including 31st March. This includes all payments made and receipts received, even if they haven't appeared on the bank statement yet, as well as any bank transfers.
2. Carry out a Bank Reconciliation
Reconcile all your bank accounts up to 31st March to confirm the data in Scribe tallies with your bank statement. Your total cash in hand as at 31st March should match Boxes 7 & 8 on the annual return. Save or print a copy of the Bank Reconciliation report for your year-end paperwork.
3. Complete a VAT Return or Claim
If possible, complete a VAT return/claim up to 31st March. The amount to be claimed from or paid to HMRC should match your closing VAT position as per the VAT Summary.
4. Check your Asset Register
Ensure that the Asset Register is up to date. The total of the purchase value (or current value depending on the setup) will be entered into Box 9 on the annual return. Save or print a report for your year-end paperwork.
5. Check your Borrowings
Confirm that all short-term and long-term loans have been entered under Borrowings. The total of the Outstanding Amount will be entered into Box 10, and this figure must be manually updated as at 31st March. Save or print a report for your year-end paperwork.
6. Enter the end of year Adjustments
This includes creditors, debtors, accruals, prepayments etc. Run an Adjustments report to check all have been entered correctly. Print/save a copy for your year-end paperwork.
7. Check your Reserves
Confirm that all entries relating to Capital or Earmarked Reserves have been made for the year and make any further transfers as required. The final totals will show on the Income and Expenditure Account and the Balance Sheet.
8. Enter Temporary Assets (for the Balance Sheet)
Enter any short-term assets to show on the Balance Sheet. Anything entered here will not affect the Annual Return - the Box 9 figure comes from the entries on the Asset Register only.
9. Check the Cost Codes for the Annual Return
Ensure that the cost codes relating to Precept, Staff Costs, and Capital Repayments have been allocated the correct 'Type' under setup.
10. Calculate
Once the data has been entered, run the 'Calculate' function to populate the end of year reports with data.
11. Run the end of year reports
Run a Working Document report, an Income and Expenditure Account, a listing of your Fixed Assets and Borrowings, and the Balance Sheet. Print/save a copy for your year-end paperwork.
12. Run the Annual Return
The Annual Return can be run multiple times, so corrections and amendments can be made before re-running. Once the figures are correct, they can be transferred onto your AGAR form.
13. Run the Reconciliation between Box 7 and 8 report
Since the Annual Return has been run on an Income and Expenditure basis, there will be a difference between Box 7 and 8. This report will explain the difference so you can understand how these amounts have been derived. Print or Save a copy for your Year End paperwork.
14. Close the Accounts
After the final Annual Return and associated reports have been produced, you should wait for the accounts to be signed off and audited. In the meantime, consider closing the accounts to prevent data entry or amendments. If amendments need to be made later on, the accounts can simply be reopened.
Remember, the sequence of steps 4 - 9 can be changed according to your needs but they should all be completed (where necessary) before moving to the 'Calculate' stage.