Minutes:
The Head of Finance and Customer Services provided an update on submission of 2020-21 Statement of Accounts. It was reported that information for periods 1-10 and period 11 up to the 7th February of the financial year 2020-21 that had been transferred from the old eFin system into the new TechOne finance system after the system change on 8th February 2021 had not been fully documented at the time. This included screenshots or a record of transactions derived directly from the old system and on the new system on day one. Furthermore, there was no audit trail of the standing and transactional data as of when the old Civica system was being decommissioned (the last day) and of the starting point when the new TechOne finance system was introduced. Instead, this data was recorded in spreadsheets. As such evidence for the periods 1-10 of 2020-21 and for when the finance system was replaced had to be backtracked.
It was reported regarding the 2020-21 Statement of Accounts that the external auditor had to be satisfied with the data take-on balances before full audit of the Accounts could take place. It was anticipated that due to this the Accounts would be submitted to the auditors in late April and the main audit work would commence in July 2022.
Officers reported that work had begun on the 2021-22 Statement of Accounts but further progression depended on the outcome of audit work of 2020-21 Accounts. It was noted that training sessions on end-of-year closure and other finance aspects were available for Officers (requisitioners and managers) and attendance at those training sessions was high.
It was noted that the 2022-23 Ledger Book was to close on 28th April 2023 and an outturn report would be taken before the Executive Committee in July.
Following the update, several questions were asked of Officers and the External Auditor to which the following answers were provided:
· The External Auditor reported that deficiencies would be reported around data take-on as the original transfer of data from the old to the new finance system did not take place correctly and now necessitated Officers having to recreate the evidence trail.
· Due to considerable additional work expected around the audit of finance system data migration, a significant variation to the audit fee for 2020-21 Accounts was expected. It was reported that the external auditor’s proposed variation to the audit fee would be submitted to the Public Section Audit Appointments (PSAA) panel before the fee would be determined.
· For 2019-20 Accounts, the Council’s audit fee amounted to an additional £20,000 above the standard fee.
· Officers reported that determination of the amounts in reserves for the 2020-21 Accounts period remained to be agreed with the auditor as did the amounts going into suspense. It was reported that difficulties were also expected in deriving transactional samples for auditing.
· The External Auditor noted that the auditors became aware of additional work required in auditing 2020-21 Accounts in Autumn 2022
· Officers had worked on rectification of 2020-21 Accounts issues for 2-3 months in August-October 2022 in parallel with work on rectification of the cash receipting module, which was now resolved.
· Members sought assurance that the Council would not be the last in the country to sign-off 2020-21 Statement of Accounts. It was reported that in total there were around 20 other local authorities which had not finalised 2020-21 Accounts yet.
· Mandatory suite of training was being delivered for managers in the Council around financial awareness and budget process. It was reported that training provision was needed to improve finance skills in the authority.
· The Council remained the only local authority in the Country using the TechOne cash receipting module.