WARNING - By their nature, text files cannot include scanned images and tables. The process of converting documents to text only, can cause formatting changes and misinterpretation of the contents can sometimes result. Wherever possible you should refer to the pdf version of this document. CAIRNGORMS NATIONAL PARK AUTHORITY Finance Committee Paper 5 30/11/07 CAIRNGORMS NATIONAL PARK AUTHORITY FINANCE COMMITTEE FOR DISCUSSION Title: OUTTURN FOR THE SEVEN MONTHS TO OCTOBER 2007 including BUDGET UPDATE Prepared by: Denby Pettitt, Finance Manager Purpose To provide Members with an update and information on the outturn for the seven months to October 31, 2007 together with an update on the results of the Q2 Operational Plan review performed in September and any proposed changes to the budget for the second half of the year. Recommendations That the Committee: a) note the draft outturn for the seven months to October 31, 2007. b) note the outcome of the Q2 Operational Plan review and consider any remedial action that needs to be taken; and c) approve the latest forecast shown in Annex 1. Executive Summary a) Annex 1 shows the Income and Expenditure account for the seven months to the end of October. A commentary on each line is also included. b) At the end of October we were underspent by £557,000 against budget. Of this £471,000 related to the Operational Plan (49% under budget) and £86,000 to Core and non-cash costs (5% under budget) c) The Q2 Operational Plan review has been performed. The review indicated that, in line with previous years, spend is at present behind budget but we believe year end spend will be in line with budget. d) The budgets have been amended to reflect both the Operational Plan changes (para. 9) and changes to the Core budget (para. 12). OUTTURN FOR THE FIVE MONTHS TO AUGUST 2007 INCLUDING BUDGET UPDATE FOR DISCUSSION Overview 1. Annex 1 includes the latest Income and Expenditure account together with commentary on each line which focuses on actual income or expenditure against budget. 2. Annex 2 shows how the Authority is performing against agreed financial targets which are reported to the Board quarterly in the Balanced Scorecard Summary. Grant in Aid drawdown and expenditure patterns 3. The chart below summarises the monthly GIA drawdowns for the last two financial years, with 2007-08 on the left and 2006-07 grant on the right of each month’s columns. This provides a broad overview of the Authority’s expenditure pattern over the course of these two years. CNPA Grant in Aid drawdown (Chart not available in full text format) 4. The above chart shows that the profile of monthly grant drawdowns was previously in line with the previous year but has slipped in November and we need to monitor this closely to ensure that we maximise use of our resource allocation. 5. The chart below shows the cumulative expenditure over the course of the year compared with budget and last year’s expenditure profile. CNPA Cumulative expenditure percentages (Chart not available in full text format) 6. As well as expenditure continuing to fall behind budget due to the slowness of Operational Plan spend the current rate of expenditure has also slipped further behind that achieved last year, i.e. to the end of October we have spend 45% of our yearly spend compared with 56% for the same period last year. 7. The Q2 Operational Plan review (see below) will focus on action necessary to bring spend back into line with budget. Operational Plan review (Q2 2007) 8. We have held the second series of quarterly reviews between individual Heads of Group and Corporate Services. The purpose of this review is to critically analyse individual expenditure lines to receive early indications as to whether individual actions or group tasks identified in the Operational Plan are on track or whether corrective action is needed. 9. The Q2 review has been discussed by the full Management Team and the outcome is summarised below: No. / £’000 Operational Plan (at start of year) - 1,682 New spend opportunities 7 25 Existing opportunities - increased spend 15 133 - reduced spend 11 (100) Revised planned expenditure total after Q2 review 1,740 Potential Operational Plan overspend ( 58) 10. It is the nature of Operational Plan spend that expenditure can be delayed, therefore projecting an overspend £58,000 does not give cause for concern at this time in the financial year especially since we are forecasting a reduction in Core spend (see para. 12). Latest forecast 11. Normally, six months through the Financial Year is a time to review the overall budget and Annex 1 shows our latest estimate in the right-hand column. 12. The following table summarises changes to the budget: £’000 Initial budget deficit (52) Reduced Core expenditure 22 Increased Operational Plan expenditure (58) Revised budget deficit (88) 13. Forecast reductions in Core expenditure reflect underspend to date and known changes in the second half of the year. These are reduction in salary costs £25,000 and reduced non-cash income (£3,000). 14. The forecast for Operational Plan spend reflects the outcome of the Q2 Operational Plan review. Denby Pettitt 19 November 2007 denbypettitt@cairngorms.co.uk CNPA Income & Expenditure account (October 2007) (Table not available in full text format) Notes: Initial budget This was presented to the Finance Committee at their meeting on June 15. Latest forecast Finance Committee is asked to approve the changes and, if approved, this will then become the latest budget against which future activity will be monitored and variances reported. CNPA Balanced Scorecard Performance Measures - Finance (Table not available in full text format)