(1) The Authority
must, in the exercise and performance of its powers and functions, act in
accordance with proper principles of financial management and with a view to
avoiding a loss.
(2) Any surplus of
funds remaining after deduction or allowance for the costs of the Authority,
and for any liability under section 31A, may—
(a) be
retained and invested by the Authority; or
(b) be
distributed amongst the councils and prescribed local government bodies with
which the Authority has entered into financial arrangements; or
(c) be
applied for the benefit of any council or prescribed local government body or
for any other local government purpose,
as the Authority thinks fit.