What is the Explanation of Variances Report within Parish and Town Councils

The Explanation of Variances Report within Parish and Town Councils is a report required by the external auditors, specifically outlining and explaining any significant variances in the Annual Return Section 2: Accounting Statements of the AGAR. 

 

What is the Explanation of Variances Report within Scribe Accounts

The Explanation of Variances Report is a function in Scribe Accounts that replicates the auditor's required report for explaining variances on the Annual Return Section 2: Accounting Statements of the AGAR. Explanations can be added at any time - notes could be added in here throughout the year if you want to record something that may have an effect on a variance at the Year End point so that it gives a starting point to assist with explaining the variance. 

 

Where is the Explanation of Variances Report within Scribe Accounts

To access the Explanation of Variances Report, log into your Scribe Accounts and navigate to menu Year End → Explanation of Variances.

 

How To Generate an Explanation of Variances Report within Scribe Accounts

To generate an Explanation of Variances Report:

1. Log into your Scribe Accounts and navigate to menu Year End → Explanation of Variances.
2. The screen presented will list the boxes as per your annual return with figures for the current year and the prior year. The variance will be shown as both an amount and a percentage.
3. Enter your explanation in the text box on the right-hand side against the appropriate box if an explanation is required. This can be a full explanation that can be copied into the auditor's report or you can add notes here throughout the year to record instances that may have an impact on a variance, e.g. overtime paid to clerk, unexpected repairs or one-off unbudgeted purchase. 
4. Save your notes by clicking 'Save' at the top or bottom of the screen. 
5. Once all necessary explanations have been added, you can create the report if you wish to print, save or download it. Click 'Explanation Report' in the top right-hand corner.

💡 This report is intended as a guide to the variances you may need to explain. The specific requirements vary between external auditors so please check the requirements shown on the pro forma provided to your council.

💡  An explanation will also be required if Box 7 is more than double Box 2 - this will be due to Reserves held. If you record your Council's Reserves on Scribe then the Reserves Balance report will assist you in explaining this.

 

How to Download or Share an Explanation of Variances Report

After generating the report, click the 'Download' button, choose the required format, and your report will start downloading.

 

How to Print an Explanation of Variances Report

Once you have created your report, you can print it by simply clicking the printer icon at the top right corner of the report.