From the Newsroom

CVC to request more time to prepare financial statements

Geoff Helisma|

Clarence Valley Council (CVC) will apply to the NSW Office of Local Government (OLG) for an extra month to prepare its 2020/21 annual financial statements.

The NSW Local Government Act stipulates that a “copy of the audited financial statements and auditor’s reports” must be sent to the “Chief Executive, OLG by 31 October”.
The council is party to a 2021 Client Service Plan (CSP), “agreed upon between CVC, its external auditors and the NSW Audit Office, which “outlined key dates for the 2021 audit and was sent to CVC at the end of February 2021”.

Staff advised councillors at yesterday’s August 24 CVC meeting that the “external valuer” engaged to make a “comprehensive revaluation of [CVC’s] water & sewer assets” was, “unfortunately, not able to meet the agreed timeframe and the final report was issued to CVC on 30 June 2021”.

The CSP flagged May 31 as the finalisation date for the water and sewer assets revaluation and the starting date for the external audit team, however, the delayed revaluation meant that CVC did not “provide the report and associated supporting workpapers to the auditors [until] 9 July 2021”.

“During the period of the revaluation being conducted, CVC had been in constant contact with the external valuer to seek assurances on completion timeframes, which were subsequently not met,” staff advised councillors.

“…The delay in providing the water and sewer revaluation report and supporting workpapers to the council’s external auditor … means that meeting the legislative deadline of 31 October 2021 is very tight, as the external auditors need to be able to complete this review as well [because] the final financial statements audit and the NSW Audit
Office needs to review their audit files.”

Staff advised councillors that “if an extension is not granted by the OLG then there is a risk that CVC will not be complying with the 31 October 2021 deadline for the lodgement of the 2020/21 annual financial statements”.

The Local Government Act (Section 416) states that councils “may from time to time apply to the Departmental Chief Executive for an extension of that period”, however, “before deciding whether or not to grant an extension, the Departmental Chief Executive may require the council to give reasons, additional to those set out in the application, as to why the extension should be granted”.