119.1 Overview
Reserves are amounts set aside by the Council as a result of surpluses, deferred expenditure or policy decisions to ‘save’ towards future expenditure. Reserves can be either specific (earmarked) or general. The level of general reserves must be decided before the Budget and the Council Tax can be fixed.
119.2 Establishing New Reserves
Before setting up a new reserve, the following information must be provided:
- The reason for/purpose of the reserve
- How and when the reserve can be used
- Procedures for the reserve’s management and control
- A process and timescale for review of the reserve to ensure continuing relevance and adequacy.
In order that this information is provided a form should be obtained from Corporate Accountancy, completed and returned before creating a new reserve.
Before setting up a new reserve, this form must be submitted for approval to the Head of Resources. Click here for the Reserves form.
119.3 Existing Reserves
The budget report to the Council should include a statement showing the estimated opening reserve balances for the year ahead, the addition to/withdrawal from balances, and the estimated year end balance. Reference should be made as to the extent to which such reserves are to be used to finance recurrent expenditure.
119.4 Appropriations to/from Reserves
All transactions to or from reserves will be in accordance with the SORP, and subject to approval by council when the statement of accounts is approved.
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