Additional appendices and addendums were tabled.

Members discussed the final audited accounts with the external auditors and officers including the following matters:

• The collection fund reserve was an unusable reserve and was not shown with the other reserves;
• The analytical tools were not available to use because of the complexity of the systems and the late appointment of auditors – the tools should be available next year;
• Underspends which ran for more than a year were prioritised to be taken as savings;
• The underspend for 2012/13 was £1.2 m – it was anticipated that 2013/14 would be less than that;
• The capital programme was last reprofiled at September Cabinet and was kept under constant review – officers were encouraged to take a whole programme approach to their capital programme plans;
• The auditors did not make a judgement on the level of reserves and there was no benchmarking;
• The planned use of reserves was reported to Council at its budget meeting each year – Merton’s reserves level was at around the mid-level for London boroughs;
• Financial management systems needed updating to make them less complex and cumbersome – this work had been approved by Cabinet in September and was now underway;
• Short term deposits were increased as reserves were available to invest;
• The pension fund was 85% funded at the last valuation – this is in the top half of funds across London;

RESOLVED:

1. That the General Purposes Committee approve the audited Statement of Accounts, including the Pension Fund Accounts.

2. That the General Purposes Committee note any comments made by the Pensions Fund Advisory Panel in relation to the Annual Pension Fund Accounts 2012/13.

3. To note Ernst & Young’s Audit Results Report for the Council’s Pension Fund accounts under the International Standard on Auditing 260 (ISA 260).

4. To note Ernst & Young’s Audit Results Report for the Council’s main accounts under the ISA 260.

5. That the Chair signs the Letter of Representation for the Council’s 2012/13 main accounts.

6. That the Chair signs the Letter of Representation for the Council’s 2012/13 Pension Fund accounts.