Code Of Practice On Local Authority Accounting In The United Kingdom: Guidance Notes For 2023/24 Accounts (print)

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This year's edition of the Guidance Notes provides detailed guidance on the key accounting changes introduced by the Code of Practice on Local Authority Accounting in the United Kingdom 2023/24 (the Code).

The key accounting changes in this edition of the Guidance Notes include:

• Confirmation in Module 1 Appendix B of the New or Amended Standards introduced in the 2023/24 Code.
• Updates to the methodology in Module 2, Section A to provide explanatory guidance to practitioners on the application of amendments to IAS 1 related to the selection and presentation of accounting policies to aid the relevance of information presented in the financial statements.
• Further guidance in Module 2, Section A to support practitioners when making judgements on materiality.
• Updates to the methodology in Module 2, Section G for calculating year-end apportionment of NDR and council tax surpluses following the end of exceptional deficit ‘spreading’ provisions (SI 2020/1202), and for calculating year-end Balance Sheet apportionments for council tax related balances in areas subject to Local Government reorganisation.
• Amendments to Module 3 in relation to IAS 8, to clarify the distinction between changes in accounting estimates and changes in accounting policies and the correction of errors.
• Amendments to Module 4 relating to the provision of temporary relief so that local authorities are not required to report the gross book value and accumulated depreciation for infrastructure assets. Where a local authority chooses to apply this temporary relief, the Code requires that additional information is provided to explain an authority’s rationale for this decision. This temporary relief does not apply to local authorities in Scotland, for which an analogous treatment is prescribed by Local government finance circular 09/2022: statutory override – accounting for infrastructure assets issued in August 2022 by the Scottish Government.
• A new table within Module 4 providing a summary of the various prescriptions over time in local government financial reporting for infrastructure assets.
• The inclusion in Module 6 of the impact of IFRIC 14 IAS 19 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction. This reflects the information contained in CIPFA Bulletin 15.

The publication is important and should be considered at the earliest opportunity because of the prevalence of leasing in local government and the risk that the changes could have a budgetary impact if not managed effectively.