Report of Treasurer. [Report attached]

Contact: Duncan Whitfield.

That the finalised Statement of Accounts 2025/26 be signed by the Chairman and the Treasurer.

That the Annual Governance Statement 2025/26 be noted.

The Director of West Mercia Energy, Nigel Evans presented the Statement of Accounts 2025/26 and Annual Governance Statement 2025/26 report. He highlighted the key areas of the accounts, including a strong trading performance, high customer retention levels, the impact of energy market conditions during the year, system developments delivered over the previous 12 months and the overall financial results.

Members were informed that the Income and Expenditure Account showed a net operating surplus of £2.192 million, compared with £2 million in the previous year and although turnover had reduced during the year it was explained that this reflected lower energy prices for customers and was therefore a positive outcome. In relation to pensions, it was noted that an actuarial valuation showed the pension scheme to be in surplus, although no pension asset had been recognised in accordance with accounting standards.

Referring to the Annual Governance Statement, Nigel Evans highlighted the internal audit work undertaken during the year. He reported that audit opinions had generally been positive, apart from procurement, where a significant recommendation had been made regarding the absence of a formal service level agreement (SLA) with the member authorities. He advised that this issue was being addressed through the development of a formal agreement with Shropshire Council and added that Internal Audit had provided a high assurance rating for the organisation’s governance arrangements.

RESOLVED:

1.    That the finalised Statement of Accounts 2025/26 be signed by the Chairman and the Treasurer.

2.    That the Annual Governance Statement 2025/26 be noted.