Agenda item

The Committee received an update on the 2020/21 Statement of Accounts along with subsequent years’ statements of accounts. A summary of audit progress covering 2020/21 to 2022/23 had also been circulated prior to the meeting and tabled. Mr Mark Stocks, Audit Partner, Grant Thornton, External Auditor was in attendance for this item. Mr David Skinner, Section 151 Officer introduced the update.

Key points raised during the update and throughout the discussion included:

·   Work continued to complete the 2020/21 set of accounts following substantial progress having been made to conclude a host of issues. Areas of focus remained, one of which was the revaluation of Council owned land and buildings with historic valuations dating back to 2017/18 requiring further examination, on which the finance team continued to work closely with the external auditors to address. It was noted that much of the previous valuation data came from legacy councils which added a layer of complexity; however, the finance team was working hard to address the issue.

·   In terms of the impact of the property valuation, the Committee heard that the primary focus of the audit was to provide assurance around general fund reserves and ensure income and expenditure for 2020/21 was accurately stated, however there could be a scenario where the balance sheet was uncertain which could result in a qualification on that aspect of the accounts. This would not impact the general fund reserves or usable reserves, however, would give a level of uncertainty around property valuations until the 2023/24 cycle was concluded and up to date valuations of assets were recorded. This would not impact the way the Council was run and nothing untoward was suggested in respect of historic valuations. The Committee heard that if anything, it was believed that the assets may have been slightly undervalued.

·   A separate ongoing area had been in relation to auditing IT systems, with the external auditor experiencing some difficulties from their side with getting the necessary IT access. This had been resolved just prior to this meeting and the Council would now seek to provide the data required to undertake testing as soon as possible.

·   There was confidence, that as with previous obstacles faced, the outstanding queries could be satisfied to issue an opinion on the 2020/21 accounts in time for March’s Committee meeting and assurance was provided that the finance team was appropriately resourced to satisfy the conclusion of the audit. The external audit team was currently on site working with the finance team.

·   In terms of the previously discussed Government backstop date, the Committee was advised that the proposed date was expected to move from the end of March 2024 to the end of September 2024. This would still not allow sufficient time to satisfactorily audit the 2021/22 and 2022/23 accounts, and the plan would remain to conclude draft documentation for those sets of accounts with some kind of disclaimer of opinion expected to be issued. This would allow work to move on to the 2023/24 set of accounts as soon as possible with the audit planned to be completed by the end of the 2024 calendar year.

·   It had also been previously discussed that accounting standards and regulatory requirements may be amended to reduce the burden and complexity involved in local authority accounting, however these proposals had not progressed or been released at the time of this meeting.

·   The change of external auditor, following the PSAA retendering was due to commence for the 2024/25 accounts. Once the 2023/24 work was completed there would be close liaison between the Council, Grant Thornton and the incoming audit team with activity planned to ensure adequate handovers were in place.

RESOLVED:

That the update be noted.