Agenda item

By way of introduction Mr Lloyd-Thomas from BDO, external auditor apologised to the Committee for the lateness of the interim report which resulted in Members being left with insufficient time to consider the interim report. He explained to the Committee that they’d been unable to close down the issues that had arisen in the time available and as consequence unable to present a final position report to the Committee.

Mr Lloyd-Thomas clarified that they had only recently become aware of the OFSTED report (which was not part of the original risk assessment) and as such the focus had been more on the accounts audit rather than the Use of Resources. He further clarified for the Committee that this would have been picked up before the final report was issued as part of the process involves looking at recent reports published by the relevant regulatory bodies including OFSTED inspections. 

Mr Lloyd-Thomas and Mr Jody Etherington proceeded to present the interim report which detailed the key findings arising from the audit. The Committee were provided with updates that had been received since the publication of the report on key issues identified.  

With regards to the audit finding referencing ‘…..high level of manual intervention…’ on page 23 of the supplementary pack, Changes in presentation of  the financial statement, the Assistant Director of Finance, CSG confirmed that reducing the level of manual intervention required would be picked up  as part of the improvement plan [ACTION]

With regards to the audit finding referencing ‘…..declarations have not been received from 7 current Members of the Council’ on page 26 of the supplementary pack, Consideration of party related functions, Mr Etheringiton updated the Committee that there were now only 5 members with outstanding declarations.

With regards to the OFSTED inspection, Mr Lloyd-Thomas clarified for the Committee that this would be reported as a ‘qualified use in resource opinion’ rather than a ‘clean opinion’. He referred to guidance that sets out where OFSTED finds a service as failing service that has to be reported as a failure within the governance of the Council.

With regards to the Pension Fund Committee meeting taking place in September the Director of Resources confirmed that the Committee would receive the revised Pension Fund Accounts and the auditor’s report on the Pension Fund. [ACTION]

The Committee requested that the issues around the errors in the accounts and a review as to whether the key performance indicators are adequate are brought to the attention of the Performance and Contract Management Committee [ACTION]

The Committee further requested that the Chairman write the Chief Executive of the Council expressing their concern at (i) the failure of the external Auditors to deliver the accounts audit within the agreed time table and (ii) that the process followed by the external auditors in terms of servicing the Committee which would should allow the Committee function effectively, did not work [ACTION]

As the statutory deadline for signing off the accounts is 30th September the Chairman, duly seconded by Councillor Khatri, proposed a motion that an additional meeting should be convened on Tuesday 19th September 2017 to consider the final accounts and moved an additional and new recommendation 2.

A separate vote was taken on the recommendations 1 and the new recommendation 2.

Recommendation 1:

1. That the Committee consider the Statement of Accounts 2016/17 and recommend that they be signed by the Chairman and the Director of Resources (Statutory 151 Officer) on behalf of the Council when the audit is complete and the ISA260 report is produced, unless there are any significant unadjusted changes that would affect the true and fair value assessment of the auditors.

Upon being put to the vote the recommendation was lost.

New recommendation 2:

2. That the Committee note that, should the above recommendation 1 not be agreed, thenan additional meeting to consider the ‘outstanding items’ be scheduled for no later than 19 September 2017.

Upon being put to the vote the recommendation was carried.

RESOLVED –

1. That the Committee agreed to an additional meeting to consider the ‘outstanding items’ be scheduled for no later than 19 September 2017.

2. That the matters raised by the external auditor relating to detailed aspects of the 2016/17 accounts audit be noted.