Agenda item

RESOLVED:

To note the content of the report.

 4.1 Lucy Nutley thanked the Council’s finance staff for their work during the audit that was carried out remotely with a number of technical issues arising. She referred the Committee first to the Local Authority Fund, with a lengthy list of outstanding items. The deadline had been extended to the 30^th November. The key message was that the proposed opinion on the accounts was unqualified but included an emphasis of matter in that it was not a modification of opinion and centred on land and buildings. The value for money was also proposed to be unqualified. On Government accounts instruction had not yet been issued by the NAO but when they were the work would be carried out relatively quickly. There had been no objections to the 2019 accounts.

The significant risks were:

· The presumed risk of management over ride of controls. No issues had been identified to date

· Fraud and error in revenue recognition. No issues had been identified to date

· Land and building valuations – emphasis of matter / Incorrect index rate used for a number of depreciated replacement costs valuations – accounts update

· Defined benefit liability valuation – assurance awaited

· Management judgement NNDR appeals provision

4.2 Lucy Nutley referred to the internal control recommendations raised including the index rates used for valuations that needed a big adjustment. There was also a recommendation on the use of suspense accounts. In relation to value for money work there was now a new code of audit practice.

4.3 Lucy Nutley told the Committee that Covid-19 only had an impact on the Council’s operation, governance and finance in the last two weeks of the 2020 year and did not feature heavily in the conclusions. 

4.4 Next steps included completing outstanding matters. There would be a need to work through the LPFA assurance. The updated accounts needed to go through a second stage review. The Audit Completion report would be reissued prior to sign off.

4.5 The Chair referred to the importance of the internal controls strengthening measures in place and value for money at the present time ensuring that the Council was a going concern. He referred to work with Councillor Rennison and Scrutiny to look at ways to adjust and develop the MTFS and that this was reassuring. 

4.6 Lucy Nutley reported on the Pensions Fund Audit Completion Report. An unqualified opinion was envisaged and a consistency report would be issued on the Pension Fund which had an end of November deadline. She referred to a number of outstanding items as listed. The investment confirmation was significant and an emphasis of matter as an updated valuation had been requested for the property fund that the fund had invested in. The risks included:

· The presumed risk of management over ride of controls. No issues had been identified to date

· Difficulty in valuation of level 3 investments due to Covid-19 

4.7 The Chair asked if the Pensions Committee consider before sign off. Michel Honeysett told the Committee that the report would be considered by Pensions Committee on 28 September.

4.8 The Committee thanked the Finance Team and the Mazars for their work in completing the audit on time.

4.9  The Chair stressed the importance of a strategic overview of the Council’s governance processes. The Chair referred to the need of Audit Committee oversight of the operation of commercial companies with a suitable reporting framework. Michael Honeysett confirmed that once the company’s accounts had been audited a report would be made to the Audit Committee on this. Ian Williams agreed to report back to the Committee on a risk reporting framework with draft accounts on occasion for the newly established companies.

  Action: Ian Williams

RESOLVED:

To note the content of the report.