Agenda item

(External Auditor) To consider the attached report (AGC-015-2017/18).

The External Auditor presented two reports to the Committee, who was reminded that it had, within its Terms of Reference, the consideration of reports made by the External Auditor.

Audit Plan 2017/18

The External Auditor presented the first report, the Audit Plan for 2017/18, which summarised the significant risks that could impact on the audit and the key outputs from the audit. There were detailed sections setting out the scope of the audit, a risk assessment and the audit timetable.

The External Auditor reported that the Audit Plan summarised the proposed work to be undertaken for the audit of the 2017/18 financial year. It would be designed to respond to significant risks and indicated where the focus of resources would be in providing an opinion on the financial statements and value for money conclusion. There were five significant risks which could impact upon the Audit, these being: Management Override; Revenue Recognition; Property, Plant and Equipment evaluations; Pension Liability assumptions; and Financial Sustainability. The trivial threshold had been set at £40,000 for the audit and there were no planned changes to the Audit Fees for the year. It was highlighted that there was an accelerated timeline for this year’s audit.

In response to questions from the Committee, the External Auditor stated that the level of reserves to be maintained by the Council was an issue for the Council to determine as part of its Medium Term Financial Strategy. Due to the accelerated timetable for the closure of the Accounts and completion of the Audit, the External Auditor had brought forward some of its work from the Summer to now, and discussions were ongoing with the Accountancy Team at the Council regarding the measures required to meet the new deadlines. There were no planned changes to the non-audit activities for this year at the current time.

With respect to the trivial threshold that had been set for the Audit, any discrepancies that were less than £40,000 would be recorded but would not get reported to the Committee. The Director of Resources added that any errors found during the Audit would be discussed with the Director and Assistant Director of Resources, and if it was agreed that the figures were wrong then they would be corrected if possible.

Grant Claims & Returns Certification 2016/17

The second report presented by the External Auditor was the Grant Claims and Returns Certification Report, which set out the key findings from the External Auditor’s certification work.

The External Auditor highlighted that the total value of the Claim for 2016/17 had been £35.3million. There were no large errors in relation to the Claim, but three small errors had been found, none of which had exceeded £100 or required amendment. The Claim was certified before the Government deadline of 30 November, with the matters identified reported by letter to the Department of Work & Pensions.

The Director of Resources highlighted that the Council’s Claim had not required amendment this year, and this illustrated the value of the Council’s Benefit Assessors undertaking regular training.

Resolved:

(1)        That the following reports from the External Auditor be noted:

            (a)        the Audit Plan for the audit of the 2017/18 financial year; and

(b)        the Grant Claims & Returns Certification for the year ended 31 March 2017.