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Information and public services for the Island of Jersey

L'înformâtion et les sèrvices publyis pouor I'Île dé Jèrri

Budget transfer relating to Information Services - GAAP accounting

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A decision made 26 January 2011 regarding: Budget transfer relating to Information Services - GAAP accounting.

Decision Reference:  MD-C-2011-0012

 

Decision Summary Title:

Budget Transfer – CMD ISD

Date of Decision Summary:

25th January 2011

Decision Summary Author:

Finance Director

Corporate Group

Decision Summary:

Public or Exempt?

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

n/a

Written Report

Title:

ISD Budget Transfers – Capital to Revenue

Date of Written Report:

24th January 2011

Written Report Author:

Finance Director

Corporate Group

Written Report :

Public or Exempt?

Public

Subject: 

ISD Budget Transfers – Capital to Revenue

Decision(s):

The Chief Minister agreed the transfer of £176,602 from the Chief Ministers IT Capital Vote to the ISD 2010 Revenue Budget on a non-recurring basis.

Reason(s) for Decision:

 

The Treasury undertook a review of the expenditure charged to the IT Capital projects in 2010 in order to ensure that these accounts were GAAP compliant.  It was recognised that some project expenditure was of a revenue nature and should be more appropriately recognised in the revenue accounts.

 

This transfer will provide that the full revenue cost for corporate IT is presented in the Chief Ministers accounts at year end and thereby increase the visibility of States IT spend.

 

Resource Implications: Nil – transfer between capital and revenue budgets.

Action required: Treasury and Resources Finance Director to action budget transfers.

 

Signature:

 

Position: Senator T A Le Sueur, Chief Minister

 

 

Date Signed:

Date of Decision:

 

Budget transfer relating to Information Services - GAAP accounting

 Date: 24th January 2011

 

 

 

ISD Budget Transfers – Capital to Revenue

 

 

Purpose of the report

 

To request approval for the transfer of up to £200,000 budget from Resources ISD capital to revenue in order to comply with correct GAAP accounting treatment. 

 

Background

 

About two years ago a fundamental review of the expenditure in ISD found that significant spend was being recorded against capital budgets that should be more appropriately reported in the States’ revenue accounts. Much of this was annually recurring and effectively ‘business as usual’ expenditure, e.g. software licence support contract renewals. To this end permanent budget adjustments have been effected by Ministerial and States agreement to align correctly the ISD capital and revenue budget.

 

A balance of some £2 million remains in the ISD IS/IT capital vote, which continues to fund essential ‘one off’ IS/IT projects. Again many of these projects are revenue in nature and thus in order to comply with GAAP accounting principles they should be charged to the revenue accounts. An analysis of such project expenditure incurred in 2010 is shown in the table below:

 

Project

Budget Transfer

Completion of VOIP project

£13,150

Data centre refurbishments at Cyril Le Marquand & Peter Crill House

£10,110

Exchange software upgrade

£9,706

JDE works

£87,334

LiveLink Upgrade

£56,302

 

 

Total

£176,602

 

A similar transfer was agreed by the Chief Minister for 2009, (MD-C-2010-0003).

 

reCOMMENDATIONS

 

To approve the non-recurring transfer of £176,602 budget from ISD capital to ISD revenue in 2010 as required by GAAP accounting.

 

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