Budget Transfer: Defribrillators for General Hospital

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A decision made 10 December 2013:

Decision Reference: MD-HSS-2013-0052

Decision Summary Title :

H&SS Budget Transfer from Minor Capital to Revenue

Date of Decision Summary:

06 December 2013

Decision Summary Author:

Capital & Control Account Manager

Decision Summary:

Public or Exempt?

(State clauses from Code of Practice booklet)

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

Written Report

Title :

H&SS Budget Transfer from Capital to Revenue to comply with GAAP

Date of Written Report:

Written Report Author:

Capital & Control Account Manager

Written Report :

Public or Exempt?

(State clauses from Code of Practice booklet)

Public

Subject:

Approval of the transfer of £284,651 from Minor Capital Head of Expenditure to Revenue Head of Expenditure.

Decision(s):

The Minister approved the transfer of £284,651 budget from the H&SS Minor Capital Head of Expenditure to Revenue Head of Expenditure, as detailed in the attached report.

Reason(s) for Decision:

This budget transfer is the movement in budget between capital and revenue required to align the budgeting treatment of expenditure with the accounting treatment, in order to comply with GAAP.

Article 18(1)(a) of the Public Finances (Jersey) Law 2005 states that all or any part of the amount appropriated by a head of expenditure may, with the approval of the Minister for Treasury and Resources, be transferred from a revenue head of expenditure to a capital head of expenditure, or vice versa, in order to comply with generally accepted accounting principles or an Order made under Article 32. Delegation 1.2 delegates authority to the Treasurer of the States for non-contentious transfers between heads of expenditure with no financial limit where the transfer is solely to ensure that financial transactions are accurately reflected in the States’ Accounts in accordance with GAAP or an Order made under Article 32 of the Law.

Article 2(6) of the Public Finances (Transitional Arrangements) (Jersey) Order 2011 states that all or any part of the amount appropriated by a head of expenditure may, with the approval of the Minister for Treasury and Resources, be used for the purposes of another head of expenditure.

Resource Implications:

The H&SS Minor Capital head of expenditure to decrease by £284,651 in 2013 and the H&SS Revenue head of expenditure to increase by the same amount.

Action required:

The Minister for Health and Social Services to obtain the approval of the Treasurer of the States in accordance with Financial Direction 3.6 for the transfer described above.

Signature:

Position:

Minister for Health and Social Services

Date Signed:

Date of Decision (If different from Date Signed):

Budget Transfer: Defribrillators for General Hospital

Health and Social Services

Minister’s Decision Report

H&SS Budget Transfer from MINOR CAPITALto revenue

Purpose of Report

To enable the Minister to approve a non-recurring budget transfer in 2013 of £284,651 from the H&SS Minor Capital Head of Expenditure to the H&SS Revenue Head of Expenditure. This budget transfer is required in order to comply with Generally Accepted Accounting Principles (GAAP).

Background

Included within the 2013 H&SS Minor Capital budget was an amount of £284,651 to replace existing defibrillators within the General Hospital.

In compliance with Financial Direction 5.1 the tender was advertised globally and twenty two suppliers expressed an interest. Of these, seven submitted a bid. Following a desktop review three of these bidders were eliminated on the basis of cost or specification requirements. The remaining four were invited to demonstrate their equipment through interactive presentations and Q&A sessions.

Following these sessions Cardiac Services was chosen as the desired option. Through extensive negotiations a deal was reached whereby the defibrillators were secured at less than £10,000 bringing them below the de minimis level for capitalisation included in the States of Jersey Capital Accounting Manual.

As such the defibrillators must now be re-classified as revenue equipment items and accounted for in the department’s revenue head of expenditure.

A non-recurring capital to revenue budget transfer is required to comply with GAAP and match the expenditure.

Recommendation

It is recommended that the Minister of H&SS approves a non-recurring budget transfer in 2013 of £284,651 from the H&SS Minor Capital to the H&SS Revenue Head of Expenditure.

Reason for Decision

This budget transfer is the movement of budget from the Minor Capital Head of Expenditure to the Revenue Head of Expenditure, required to align the budgeting treatment of expenditure with the accounting treatment, in order to comply with GAAP.

Article 18(1)(a) of the Public Finances (Jersey) Law 2005 states that all or any part of the amount appropriated by a head of expenditure may, with the approval of the Minister for Treasury and Resources, be transferred from a Revenue head of expenditure to a Capital head of expenditure, or vice versa, in order to comply with generally accepted accounting principles or an Order made under Article 32. Delegation 1.2 delegates authority for non-contentious transfers between heads of expenditure with no financial limit where the transfer is solely to ensure that financial transactions are accurately reflected in the States’ Accounts in accordance with GAAP or an Order made under Article 32 of the Law.

Resource Implications

The H&SS Minor Capital Head of Expenditure to decrease by £284,651 in 2013 and the H&SS Revenue Head of Expenditure to increase by the same amount.

Report author : Capital & Control Account Manager	Document date : 6 December 2013
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