§ Mrs. Virginia Bottomley
asked the Secretary of State for the Environment when he expects the form of local authority statements of accounts to be prescribed by regulation; and what he expects this form to be.
§ Mr. Kenneth Baker
In the light of comments received in response to their consultation paper issued earlier this year, my right hon. Friend, together with my right hon. Friend the Secretary of State for Wales, proposes to make regulations which will first apply to local authorities' statements of accounts for the financial year beginning 1 April 1986, and which will specify both the accounts to be included in these statements and particular items to be disclosed. My right hon. Friends propose that the regulations should require statements of accounts which
- (i) contain both individual accounts for each main fund and consolidated accounts showing an authority's overall financial position;
- (ii) have a standard service based analysis of income and expenditure;
- (iii) have a balance sheet prepared on the "deferred charges" basis thereby focusing on an authority's outstanding liabilities rather than on the historic cost of its fixed assets;
- (iv) contain notes to the accounts providing additional information; and
- (v) are in a form suitable for integration with annual reports.
The details of the regulations will be subject of further consultation, in particular with the local authority associations, the Audit Commission, and with the accountancy profession.