Agenda item

To update Members on Grant Thornton’s progress in delivering their responsibilities as the Council’s external auditors.

(Report attached)

Members received an update report from Grant Thornton on progress they had made in delivering their responsibilities as the Council’s external auditors.  The report also provided an insight into emerging national issues and developments which might be of relevance to the Council in the future.

Richard Percival stated that this would be the last meeting which Zoe Thomas, Grant Thornton Audit Manager, would be attending.  Suzanne Joberns was due to take over the Audit Manager role and would be attending Committee meetings from April onwards.

Zoe Thomas presented the update report and advised that Grant Thornton’s opinion on the 2014/15 accounts had been issued on 16th December 2015; some time after the statutory 30th September deadline.  The Annual Audit Letter which appeared later in the agenda provided further detail on the reasons for the delay.  An updated Audit Findings Report had been presented to the Chair of the Committee prior to the accounts being approved by him under the delegated arrangements agreed at the 24th September 2015 Committee meeting.  Statutory s11 recommendations had been issued reflecting Grant Thornton’s concerns, to which the Council was required to publish a response, and progress against which should routinely be reported to the Committee and to the Chair of the Committee between meetings.  Grant Thornton’s Value for Money conclusion had also been issued on 16th December, the opinion for which had been qualified due to the Council being deemed as not having adequate arrangements in place to demonstrate financial resilience. 

Grant Thornton had certified the Council’s housing subsidy claim on 18th December, after the departmental deadline of 30th November, further details of which appeared in the Certification Report later in the agenda.  A number of errors had been identified as part of this work, the impact of which had been reported to the Department of Work and Pensions (DWP) in the qualification letter.  It was likely that the DWP might request further information from the Council as a result of this and could possibly require additional external audit work for this.  Some subsidy might be withheld as a result of the qualification letter and due to the amount of additional work undertaken Grant Thornton would be requesting additional fees, the level of which had still to be agreed but which it was reported would be significant.   

For the 2015/16 Accounts Audit Plan, the scale fee had been set at £57,960, which compared to a fee of £77,280 in 2014/15, with an anticipated grant fee of £10,529 for audit of the Council’s housing subsidy claim.  The fees assumed that the accounts would be prepared on time, supported by a good standard of working papers and with staff availability as agreed.  In response to a Member’s question regarding the problems encountered with the 2014/15 audit, and the position in relation to the 2015/16 audit, Officers stated that they had formulated a very clear action plan to address the issues raised, with a view to minimising any possible problems with the 2015/16 audit. 

Officers had in place an action plan to address the 2014/15 concerns raised by Grant Thornton, and Grant Thornton would consider progress against the action plan as part of their interim audit work in Spring 2016.  Officers would be reporting throughout the year on the Council’s progress against the s11 recommendations, which Grant Thornton would also consider as part of their ongoing reporting to the Committee.

Grant Thornton planned to undertake their interim audit in January and February 2016 and to start work on the final accounts audit in July 2016, with the Audit Findings report due to be presented at the September meeting.  The scope for the Value for Money conclusion had changed this year and Grant Thornton would be undertaking a risk assessment on this shortly.

In relation to the emerging national issues and developments section of the report, Mr Jones commented that some of the links in the report did not appear to be working.  Zoe Thomas therefore agreed to send the reports referred to at agenda pages 28 and 29 to Mr Jones.

RESOLVED that

the report be noted.