Commentary on Sections Accounting Section 238: Amendments relating to capital finance and accounting practices
567.The “prudential” capital finance system, in Part 1 of the Local Government Act 2003, is the framework within which authorities finance their capital expenditure.
568.Section 21 of the 2003 Act contains a power to make regulations on local authorities’ accounting practices. This has been used, for example, to make regulations about providing for debt repayment. This section amends section 21 to give the Secretary of State a power to issue guidance on accounting practices, which authorities would be required to have regard to. The power is likely to be first used in relation to the regulations on debt repayment.