Agenda item

Report to follow.

Joseph Holmes introduced the report (Agenda Item 10), and clarified that members were being asked to approve the draft audit findings of Grant Thornton in respect of their external review of the 2020/21 Financial Statements subject to no further material changes as a result of the delayed pension fund audit being administered by the Royal Borough of Windsor and Maidenhead. 

It was highlighted that contrary to the statement in section 5, the recommendation was that the Committee approve delegation to the Council’s Executive Director for Resources and the Chairman to sign off the Financial Statements once the findings of Grant Thornton had been considered.

Iain Murray (Grant Thornton), commented that the pension fund auditor had reported that there had been an overstatement of investments within the fund. Grant Thornton were consequently assessing the impact of this to West Berkshire Council’s assets. 

In relation to the double accounting school employee expenses for two schools, Iain Murray commented that it was not out of the ordinary and had probably been as a result of human error and remote working. It was noted that the impact had been adjusted in the latest set of accounts, and was clarified that they were purely financial accounting entry errors rather than actual double payments.

Councillor Jeremy Cottam expressed discomfort at the delays by the pension fund and queried whether they were operating a fundamentally flawed system.

Joseph Holmes clarified that the delay was due to the timetable of the auditor rather than the fund producing late figures. Iain Murray commented that there were delays across the whole of the sector which were not acceptable but clarified that Grant Thornton now had the information from the pension fund that it needed, but needed to conduct further investigation and analysis as a result.

Councillor Andy Moore queried how serious the four follow up recommendations listed in Appendix B were perceived. Iain Murray responded that they were not significant enough to impact the opinion, but had been suggested to improve the process. David Johnson (Grant Thornton), agreed and commented that it was not unusual for such errors to occur, particularly as they were as a result of manual systems rather than automated.

Joseph Holmes commented that the more manual the report, the more room for potential error and that this was an area of focus for improvement for the year ahead. 

In relation to the £6.3m pension shortfall, Joseph Holmes commented that the council made increasing annual employer contributions and that he felt that the contributions were sufficient to cover any shortfall at the present time.

In relation to infrastructure assets, Iain Murray commented that it was currently an issue within the sector as to how they were accounted, and responding to Councillor Biyi Oloko’s query commented that he did not know how it would affect the council’s value of assets, but did not feel that it would have a material impact as it was a particularly technical issue.

RESOLVED that:

·         Governance and Ethics Committee delegate authority to sign the 2020/21 Financial Statements to the Councils Executive Director for Resources (S151 Officer) and the Chair of the Governance & Ethics Committee, once the Council’s appointed external auditors Grant Thornton provide a formal opinion on the 2020/21 Financial Statements and in the absence of any material changes.