Agenda item

Purpose: To inform members of the external audit plan for audit of the 2021/22 Statement of Accounts.

(Councillor Tony Linden declared a personal interest in Agenda Item 6 by virtue of the fact that that he was on the Local Government Pension Scheme. As his interest was personal or an other registrable interest, but not a disclosable pecuniary interest, he determined to remain to take part in the debate and vote on the matter.)

Sophia Brown and David Johnson, external auditors from Grant Thornton, presented the plan (Agenda Item 6). David Johnson noted that the 2020/21 finances were still outstanding, and work was ongoing. The issue with infrastructure assets had now been resolved, but a significant amount of work was still being undertaken.

Councillor Adrian Abbs noted that the frequent re-evaluation of land was considered to be a risk and queried whether it would generate a liability in the accounts. David Johnson responded that the property valuation did not impact the accounts, in terms of the income and expenditure impact, but were more administrative risks rather than financial.

Councillor Linden noted that the planning process was regularly raised as a risk. David Johnson agreed, but commented that the external auditors were unlikely to focus on it as an issue. It was suggested that it would be an issue for internal auditors to review.

Councillor Jeff Cant noted the 20% increase in fees and asked the external auditors for an explanation for the increase. Sophia Brown responded that the £80,000 fee was the scale fee, with the additional work undertaken by the auditors covered by the separate fee.

Councillor Rick Jones queried whether a significant delay to the 2022/23 process was likely. Sophia Brown responded that most samples had been taken and reviewed. There were issues with some property valuations, and work was ongoing until the end of April. Councillor Jones asked whether the Committee should be concerned with any governance issue in relation to the delay. David Johnson responded that findings had been presented to an independent panel for review which had concluded that the issue was not endemic.

Councillor Linden suggested that the widespread delay in audits should be raised with the Department for Levelling Up, Housing and Communities (DLUHC). Joseph Holmes responded that it was an issue that central government were aware of.

Councillor Abbs queried the size of the portfolio of assets that was being re-assessed, and what portion of it was under investigation. Sophia Brown responded that the value of fixed assets that had been re-assessed for 2021-22 was 20%, and that approximately 100 assets had been identified as not having been captured for valuation when expected. Joseph Holmes agreed to clarify the total number of assets held in order to put the figures into some context.

Councillor Cant queried whether Simon Carey, as the Independent Person, had any observations on the external audit plan. Simon Carey responded that he did not, and that the plan was a comprehensive document.

In response to a query from Councillor Biyi Oloko, Sophia Brown explained that the auditor’s fee was determined on a broader workforce than just herself and David Johnson, including five junior trainees, staff undertaking field work and extra work undertaken in relation to ISAs.

RESOLVED that: Governance and Ethics Committee noted the External Audit Plan and Fee for the Financial Year 2021/22.