Agenda item

(External Auditors) To consider the attached report (AGC-021-2013/14).

The External Auditor presented two reports to the Committee, the first being the Annual Audit Letter for 2012/13, which summarised the key issues arising from the audit work during the year, and the second was the Fee Outturn Summary for 2012/13, which set out the final costs of the audit.

In respect of the Annual Audit Letter for 2012/13, the External Auditor reported that the key findings were:

-       an unqualified true and fair opinion on the financial statements was issued on 27 September 2013;

-       no material misstatements were identified during the audit;

-       the net effect of the unadjusted audit differences identified increased the surplus for the year by £116,000;

-       an unqualified value for money conclusion was issued on 27 September 2013;

-       the Council had implemented proper arrangements to secure economy, efficiency and effectiveness in its use of resources;

-       the Annual Governance Statement was not misleading or inconsistent and complied with the relevant guidance from CIPFA/SOLACE;

-       the Council’s Whole of Government Accounts was below the threshold for a full assurance review;

-       the short-form assurance review of the Council’s Whole of Government Accounts confirmed that the information for property, plant, equipment and the net pension liability was consistent with the audited financial statements;

-       there were improvements noted in the control environment for the 2011/12 Housing and Council Tax Benefit Subsidy claim; and

-       although there were fewer errors in comparison to previous years, the claim was qualified in accordance with the mandated approach.

In respect of the Final Fee Outturn for 2012/13, the External Auditor reported that the total fees for audit services was £117,579 – an increase of £400 on the proposed fee. The Scale Fee of £85,329 was greater than the proposed fee previously reported, but this was due to an error in the original calculation made by the Audit Commission. The final fee for the Certification work – expected to be £32,250 – would be reported separately as this work was still in progress.

The External Auditor confirmed that, for the Housing and Council Tax Benefit Subsidy Claim, the overall effect of the identified errors was a net reduction of £200, which was small when set against a total claim value of £45million. The Chairman acknowledged that Grant Certification was always a difficult process, but the implementation of a new system had improved the situation.

The External Auditor also took the opportunity to inform the Committee that BDO also provided services to a partner organisation of the Council, but that this did not generate a conflict with BDO’s role with the Council. It was a completely different and separate team advising the partner organisation and full confidentiality would be maintained. The Committee was also advised that the Audit Commission would cease to exist on 31 March 2015, with other – as yet undecided – arrangements beginning on 1 April 2015.

Resolved:

(1)        That the Annual Audit Letter for 2012/13 and the Fee Outturn Summary for 2012/13 issued by the External Auditor be noted.