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13/04/2015 - Statement from Chief Executive on Financial Position of Donegal County Council


Mr Seamus Neely, Chief Executive addressed today's meeting of Donegal County Council and referred specifically to reports in some national and local media in relation to the financial position of the organisation.


A report published during March 2015 by the Local Government Audit Service and entitled “Overview of the work of the Local Government Auditors”, was recently commented upon in some national and local media with specific reference to the financial performance associated with Local Authorities during the financial year 2013. 


Mr Neely noted that the specific details included in this report prepared by the Local Government Audit Service on this Local Authority are accurate and consistent with the details previously presented to the members of Donegal County Council.  However, he noted that there has been inaccurate interpretation of aspects of the report particularly in relation to comments around the financial solvency of the Council.


In his address Mr Neely stated that "I can confirm that there is no question with regard to the solvency of the Council in that the Council has and will continue to trade in a solvent manner and in line with required governance and financial management processes".


He added "it is factually incorrect, to suggest that any business whether public or private sector and which happens to have a revenue deficit at the end of a particular year in it’s balance sheet is insolvent. This misrepresents the position of any such business to it’s stakeholders including in the case of Donegal County Council, it’s elected members, it’s employees, it’s customers, those businesses that provide goods and services to the Council, amongst others.  In this context I can give full assurance to all of the stakeholders of the Council of fullest confidence in the ongoing financial management of the organisation and rejects any notion or suggestion that the organisation is insolvent or any connotations associated with such a term".


Mr Neely also stated that "it is useful to reflect at this time on what the most recent financial outturn is indicating, for the period ending 31st December 2014.  These accounts reflect the merged position of the County and the former Town Councils and for the first time reflect the net joint position of these various authorities". 


He added "I am pleased to report that the provisional figures for the year end position has improved by some €785,000 in respect of the County Council alone and as a result of the merge with the Town Councils (and on a once off, exceptional basis) by a further €2.045 million.  This, in net terms, will see the 2013 deficit being reduced by some €2.83 million to a reduced deficit figure of less than €15 million.


In addition to this, the Council’s financial statement also includes a credit position on our specific revenue reserve, amounting to some €3.375 million at the end of 2014.  When netted off against the general revenue deficit this €3.375 million would reflect a net deficit position of approximately €11.6 million”. 


Mr Neely referred to the prudent approaches taken when reviewing the application of appropriate provisions for bad debt and how those bad debts are dealt with and stated "I am confident in our approach in that it is fair and equitable and strikes a good balance between the needs of the Council in continuing to trade in an appropriate manner and those of the customers that it serves while acknowledging the ongoing challenging financial and economic environment and the need to collect monies to allow the Council to provide the necessary services”.


He concluded that "the Council will continue to work diligently to ensure that it can continue to provide the maximum range of services across our areas of responsibility in line with our financial capacity in a manner that does not expose the organisation to financial loss”.







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