To present Members with Grant Thornton’s Audit Letter which summarises the key findings from the work carried out at the Council for the year ended 31st March 2016.
Members were presented with Grant Thornton’s Annual Audit Letter which summarised the key findings arising from the work which they had carried out at the Council for the year ended 31st March 2016.
Mr Percival stated that Grant Thornton had given an unqualified opinion on the Council’s financial statements on 28th September 2016. Whilst Grant Thornton had not identified any issues that had required them to issue any new statutory recommendations, they had considered the Council’s response to the statutory recommendations issued in 2014/15. In doing so they had qualified their Value for Money conclusion on matters relating to progress made by the Council in implementing the 2014/15 recommendations. Grant Thornton had set out four key actions that they expected the Council to take to address the recommendations, details of which were set out in the Audit Letter. Members queried whether progress on implementing the key actions for the recommendations was improving. Mr Percival stated that work was currently being undertaken on this and that he was satisfied the direction of travel was appropriate. It was however too early to say at this stage whether all issues had been resolved as it would take time to work through these.
Whilst there had been improvements in the accounts production, further improvements were needed in order to ensure that the accounts audit could be delivered by the earlier (statutory) closedown and audit timetable in 2018. Grant Thornton were currently working with Officers to support such improvements, in particular with the standard and delivery of working papers. Officers advised that they had drawn up a detailed plan for the closedown timetable of the final accounts, which they had recently shared with Grant Thornton and which was a changing model. Officers hoped to be in a position to close down the 2016/17 accounts on 31st May 2017, which would allow opportunity to consider any ‘lessons learned’ for 2018. Mr Percival stated that Members also needed to ensure that they had sufficient understanding of the Council’s financial position. Regarding comments made in the report that there had been a failure in governance arrangements, a Member asked to see a copy of the accounts closedown timetable referred to by Officers and commented that they felt they were not always being sufficiently informed to be an effective Committee. Officers agreed to email the timetable to Members and to send a hard copy of this to Councillor Chalk.
A query was raised in relation to implementation dates for the third statutory recommendation; that the Council should improve the reporting of the annual budget and Medium Term Financial Strategy to Members, specifically to make clear the impact of proposals on the level of reserves and balances. The Action Plan stated that the cross party member budget scrutiny group would be presented with the revised format for the Medium Term Financial Plan for 2017/18 to 2020/21 in October 2016 to ensure that this met with Member expectations, however it was queried whether this had in fact happened. Officers advised that as the budget had been challenging this year they had not been in a position to present this information to Members. They added that the Medium Term Financial Plan had now been issued, which had included some improvements.
A discussion ensued regarding Members’ ability to see background / working papers. In terms of the Committee’s role, Mr Percival stated that it was not appropriate for Members to review detailed working papers. The Committee’s role was to ensure that it was satisfied that due processes had been put in place for the production of the final accounts, with ‘governance of process’ being the Committee’s main function. He added that Officers’ confirmation that action plans were in place should be sufficient, and that Members should seek to ensure that adequate progress was being made by Officers against plan delivery to ensure that any plans were being properly executed. It was also noted that, in relation to the Corporate Plan and monitoring of service performance, Grant Thornton had concluded that the arrangements in place for this were sufficient to demonstrate that the Council understood and was using performance information to support informed decision making and performance management.
The Chair questioned the role of the Committee and which elements Members could monitor as part of this. Officers advised that the Committee’s Terms of Reference and Procedure Rules set out this information. Both documents formed part of the Council’s Constitution and were referred to the Committee on an annual basis. Officers agreed to circulate a further copy of the documents for Members’ information. The Chair added that both he and other Members of the Committee could meet with Grant Thornton when required to discuss relevant issues.
the Annual Audit Letter included at Appendix 1 to the report be noted.