The record of how Reading Borough Council’s financial accounts for the year before the pandemic has finally been signed off three years down the line.

Each year, the council sets a budget for how much it aims to raise and spend from the public, and regularly reviews income and expenditure.

To ensure financial propriety, councils are obliged to get these financial records reviewed, or ‘audited’ by accountancy firms, which provide an ‘audit opinion’ of how the records have been presented.

Opinions can range from ‘unqualified’ – which means that the financial reporting has been accurate – to ‘adverse’ – where an accountancy firm judges that the financial record is incorrect.

The council has just announced that its 2019/20 Statement of Accounts has been formally signed off by external auditors, Ernst & Young.

It has received an unqualified audit opinion on the financial statements, which the council argues recognises ‘significant improvements’ it has made in its external financial reporting over recent years.

Liz Terry (Labour, Coley) lead councillor for corporate services & resources and deputy leader of the council said: “This is a good achievement and I would like to thank the finance team for their dedication and hard work.

“The fact that these Accounts are unqualified will improve the speed of conducting audits in future years.

“This result demonstrates the huge amount of work undertaken by both finance staff and external auditors to review and enhance processes.”

READ MORE: Council accounts fiasco: £1 million cost of failures confirmed and will rise higher

Cllr Josh Williams (Green, Park) the chair of the audit and governance committee, added:  “It has been a long journey, but one that it was absolutely necessary to make.

“This is just one milestone of many, but it is a very significant one.

“The audit and governance committee have time and again recognised the hard work and professionalism needed to get the Council’s accounts to this unqualified status, and thank both Ernst & Young and our finance team for their dedication to the task.”

However, the process is believed to have cost more than £1 million, as auditor Ernst & Young’s increased fees alone were estimated to be well over £1 million in 2021.

Cllr Williams has predicted that the fee will be “way beyond” £1 million, with the exact figure for Ernst & Young’s bill only being revealed later.

READ MORE: Council to miss deadline for publishing accounts for fifth year running

The process of auditing the accounts for the 2020/21 financial year is already well underway, with draft financial statements for 2021/21 being compiled by council officers ready for public inspection.

The accounts are a summary of an organisation’s financial activity over a 12-month period and they are audited to make sure they meet the criteria of being accurate and transparent as well as giving a true and fair view of the Council’s economic performance and financial stability.

Reading Borough Council is not the only council which has had a delay in its accounts being formally signed off.

A report in The Municipal Journal from March stated that more than 370 local audit opinions from auditing companies for 2020/21 have not been filed yet.