Budget Transfer/GAAP Accounting: Le Creux Country Park.

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A decision made (07/09/2009) regarding: Budget Transfer/GAAP Accounting: Le Creux Country Park.

Decision Reference: MD-TR-2009-0129
Decision Summary Title:	Capital to Revenue Budget Transfer to Comply with GAAP		Date of Decision Summary:	26 August 2009
Decision Summary Author:	Finance Manager, Decision Support		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	Capital to Revenue Transfer.		Date of Written Report:	26 August 2009
Written Report Author:	Finance Manager, Decision Support		Written Report : Public or Exempt?	Public
Subject: For the Minister for Treasury and Resources to authorise a 2009 budget transfer from minor capital to revenue in order to meet GAAP requirements and authorise transfer from capital to revenue so both the Education Sport and Culture Department and Property Holdings Department may maintain Le Creux Country Park.
Decision(s): The Minister for Treasury and Resources approved the transfer of a Minor Capital Vote (£33,900) and the balance of Les Creux Country Park (£72,177), to revenue budgets as requested in MD-ESC-2009-0012.
Reason(s) for Decision: Under Financial Direction 3.6 and the Public Finance (Jersey) Law 2005 the approval of the Minister is required for variations to heads of expenditure above £100,000 or contentious transfers below £100,000.
Resource Implications: There are no financial or manpower resource implications.
Action required: Treasury to action the budget transfers and to inform the Education, Sport and Culture Department.
Signature:		Position: Senator P. F.C. Ozouf, Minister for Treasury and Resources
Date Signed:		Date of Decision:

Budget Transfer/GAAP Accounting: Le Creux Country Park.

TREASURY AND RESOURCES MINISTER

Capital to revenue transfers

Purpose of Report

The Minister for Education, Sport and Culture has requested the Minister for Treasury and Resources to approve the following capital to revenue transfers:-

£33,900, representing the balance of the 2009 Minor Capital projects allocation, to comply with GAAP requirements; and
£72,177, representing the remaining capital allocation to the Les Creux Country Park capital project which for a number of years been used to fund maintenance expenditure.

Background

Under Financial Direction 3.6 and the Public Finance (Jersey) Law 2005 the approval of the Minister is required for any variations to heads of expenditure above £100,000 or below £100,000 if deemed contentious.

a) Transfer of Remaining 2009 Minor Capital to Revenue:

The Sport Division received its 2009 allocation for Minor Capital of £100,000. Following Ministerial Decision (MD-ESC-2009-0006), a sum of £45,000 was transferred from capital to revenue to comply with GAAP leaving a remaining Minor Capital balance of £55,000. This was to be used for the purchase of the Les Quennevais Sport Centre Swimming Pool cover. However, the Pool cover would subsequently be funded from the 2008 Minor Capital underspend of £58,471 at a revised quote of £57,300 leaving a £1,170 contingency, and therefore the 2009 Minor Capital balance remained at £55,000.

Langford’s Climbing Wall extension was completed in June 2009 at a cost of £21,100. The wall is joint owned by Victoria College, Jersey College for Girls and the Sport Division. As the schools do not have capital budgets, and because responsibility of the asset lies with the Department, ESC decided to pay for the full cost from the remaining £55,000. The schools share was then paid by transferring their liability from their revenue budgets to ESC revenue. This leaves £33,900 within the Minor Capital Vote with no further capital expenditure identified for 2009 as follows:-

To date £102,043 has been spent against the capital to revenue transfer of £45,000 (MD-ESC-2009-0006) on sports equipment and facility maintenance around the Island’s sports centres and playing fields. ESC wish to utilise the remaining £33,900 balance to offset this revenue overspend.

b) Les Creux Country Park:

The then Sport, Leisure and Recreation Committee were allocated capital funds for the creation of the Les Creux Country Park as a Millennium project in 2000. This amount has been supplemented since that time for additional and miscellaneous works. As of 2009 the balance of the project remains at £72,177.

A revenue budget was never allocated by the Department in order to maintain the Park once completed and over the last few years the remaining capital allocation has been used to fund maintenance expenditure instead. In order to comply with GAAP, and with no further capital expenditure identified for Les Creux Country Park, the Department requests that the remaining £72,177 balance is transferred to revenue so they along with Property Holdings may maintain the Park.

ESC met with Property Holdings and agreed responsibility for outstanding works and future maintenance and repairs as follows:-

Work Detail	Responsible Dept
Repair Vandalised Toilets	PH/ESC
Fencing & Security	PH
Lighting	PH
Lighting Replacement	ESC
Drainage/Down Pipes	PH
Hoggin Surfaces	PH
Soft Landscaping	ESC
Regrading of BMX area	PH

Both departments acknowledge future years funding will need to be allocated and that 2010 funding will have to be found from existing cash limits.

Recommendation

That the Minister for Treasury and Resources approves the transfer of:-

£39,300 from minor capital to revenue; and
£72,177 from capital to revenue.

Reason for Decision

To ensure compliance with financial direction 3.6 and the Public Finance (Jersey) Law 2005 and enabling the Education, Sport and Culture Department to meet revenue expenditure pressures associated with Le Creux Country Park and align budgeting with accounting treatment in relation to minor capital under the implementation of GAAP.

States Treasury Nick Collins, Finance Manager Decision Support

28 August, 2009