Agenda item
Deloitte Audit Update
Minutes:
Mr Jonathan Gooding, from Deloitte introduced the reports and said members of the Audit Committee had revised versions of the 2018/19 and 2019/20 accounts in front of them. These were in supplementary pack 1, pages 37 to 130, and pages 131-210 respectively. He said the audits for these years were substantially complete, subject to a few outstanding issues before the audits could be signed off following the management letters of representation.
Mr Gooding then took members through the 2018/19 report and said the key messages summarised the status of their work as well as the key areas of audit judgment. He said for the 2018/19 accounts, Deloitte were issuing a qualified opinion. Mr Gooding stated the key areas of audit judgement related to expenditure, valuation of properties and the decision not to prepare group accounts, to highlight a few areas. He said the report listed the control observations and made recommendations on how to improve these.
In reference to the second report, 2019/20 Mr Gooding said the issues identified were very similar, with similar conclusions reached for this set of accounts. He said that Deloitte would be issuing a qualified opinion for these accounts however it was evident a considerable amount of resources, investment as well as checks and balances had been introduced by the Council through the improvement plan to address the shortcomings.
He said no objections had been received in relation to the accounts and as such once the small number of points raised were clarified, Deloitte would be in a position to issue the audit certificates.
In response to comments and questions from members the following was noted:
- In answer to what assurances Deloitte could give, that more issues would not be raised following the latest presentation of the audits, Mr Gooding stated that in the management letters of representation the Authority agreed that the issues raised by the auditors are not material; and that relevant legal documentation is correct. He said that to satisfy themselves they had asked for an enhanced assurance that members of the Committee had understood the audit processes and said this was what was required before the audits could be signed off.
- Mr Bartle added that in his introduction he had made clear that the receipt of the ISA 260 audit reports was late on Friday 20th January and that these had been issued to members at the earliest opportunity without officer review. He said Officers had not understood the requirement from Deloitte for Members to be taken through representations being made by the Council as part of an enhanced process and he apologised for any oversight in this regard.
- Referring to the 2019/20 accounts, Councillor Saied Ahmed asked if the outstanding information required was provided, what was the timeline to sign off the accounts? Mr Gooding said he was confident the issues could be resolved in the next 2-3 weeks with certificates being issued thereafter.
- Mr Gooding confirmed that the Audits had not identified corruption or fraud as part of its work.
- In respect £20M accounted for incorrectly, Councillor Islam asked if this related to a change in formula for calculating business rates. Mr Bartle responded stating that the sum had been released to the General Fund in error however this had been corrected. It did not relate to any change in the Business Rates formula.
- Mr Bartle stated that the accounts for these years could be re-examined again and again, however the Council needed to draw a line under this and move on with the outstanding accounts for 2020/21 onwards. He said a pragmatic approach was needed.
- Councillor Bustin asked if it was clear what additional information was needed by Deloitte. Mr Gooding stated the information required was bullet pointed in the audit reports and said he hoped this could be provided within the next 2-3 weeks. Mr Tim Harlock, Interim Chief Account confirmed that he’d be able to get the information to Deloitte’s in that timeframe.
The Chair, Councillor Jahed Choudhury thanked Mr Gooding and Mr Fish for attending the meeting and said that following the discussion had earlier in the meeting, the Audit Committee would meet again once the minor outstanding queries had been resolved.
The Audit Committee RESOLVED to:
- Note the audit reports presented by Deloitte for years 2018/19 and 2019/20 and acknowledged a further extraordinary meeting of the Audit Committee would be required before the audits could be signed off, with enhanced management letters of representation.
Supporting documents: