Decision Maker: Audit and Governance Committee
Decision status: Recommendations Approved
Is Key decision?: No
Is subject to call in?: No
The committee considered the annual governance report provided by Maria Grindley of the Audit Commission, the council’s external auditor. This summarised the Audit Commission’s findings from the 2011/12 audit.
Looking at the council’s financial statements, the Audit Commission expected to issue an unqualified opinion, subject to completion of outstanding work. However, there were a number of issues the Audit Commission drew to the committee’s attention. The level of errors in the draft accounts was higher than expected. These were detailed in the report. In answer to a question from a committee member, the head of finance reported that he would investigate the reasons why this had occurred and would rectify the problem before the accounts were prepared for 2012/13. The committee noted that these errors had been corrected in the final accounts. Maria Grindley confirmed that in her view, the final accounts were materially correct, gave a true and fair view of the council’s financial position, and had been prepared properly in accordance with accounting practice.
In its value for money audit, the Audit Commission concluded that the council had made proper arrangements to secure economy, efficiency, and effectiveness in the use of its resources. Maria Grindley reported that she expected to issue her certificate to the council when she formally issued her opinion on 27 September.
Anne Ockleston of the Audit Commission reported that the council’s fee for claims and returns in 2011/12 had reduced from £33,200 to £30,000 as no issues had arisen during the audit.
Maria Grindley reported that the Audit Commission was being dissolved. As from 1 November 2012, the council’s external auditor would become Ernst & Young. However, auditing standards would remain the same.
Appended to the Audit Commission’s annual governance report was a draft letter of management representation, which the council had to sign and submit to the Audit Commission with the council’s statement of accounts. An amended copy of the letter was tabled at the meeting. The committee gave its approval for it to be signed by the council’s chief finance officer. However, as three committee members were absent, the chairman asked that they were sent a copy of the letter with a request that they replied to the chief finance officer urgently if they had any concerns.
(a) note the Audit Commission’s annual governance report 2011/12;
(b) note that the Audit Commission is likely to give an unqualified opinion to the statement of accounts 2011/12;
(c) approve the letter of representation for signature by the chief finance officer on behalf of the council, before the Audit Commission issues its final opinion and conclusion;
(d) send a copy of the letter of management representation to the three committee members absent from the meeting with a request that they reply to the chief finance officer urgently if they have any concerns with the letter;
(e) request a follow-up report from the head of finance on the reasons why the draft 2011/12 accounts contained errors; and
(f) note that the council’s external auditor will be Ernst & Young from 1 November 2012.
Report author: Steve Bishop
Publication date: 18/10/2012
Date of decision: 26/09/2012
Decided at meeting: 26/09/2012 - Audit and Governance Committee