Agenda item

Sukvinder Kalsi (Director of Finance) introduced the report on the revised 2020/21 Statement of Accounts. He noted that some of the outstanding issues around classification from the last report had been addressed but there was one matter that was outstanding nationally and would require statutory regulations in the New Year to correct so the accounts would remain open until then. A further report would come to the Committee in March to formally close the accounts.

Andy Conlan (Grant Thornton) took members through the detail of the report.

Councillor Adrian Pascu-Tulbure noted the report said there was some difficulty getting information from third-party providers and asked how that could be improved in future. Andy Conlan said that was an issue for all authorities. Auditors sent requests to a large number of third parties (e.g. banks and investment firms). Some were more complex than others. The Auditors worked closely with the Finance team to ensure they had the information they needed.

The Chair asked how much of the delays were from Covid and how much were normal behaviour. Andy Conlan said remote auditing took longer and noted it was getting better as more workplaces returned to normal.

Councillor Florian Chevoppe-Verdier asked what the end of the contract for the Private Finance Initiative referenced on page 71 meant for the service. Craig Tucker said he would need to go back to the service for detail.

ACTION: Craig Tucker

Councillor Chevoppe-Verdier asked what the TfL capital grants referred to on page 90 were. Craig Tucker said they were likely to be highways infrastructure, but he could get more detail from the service.

ACTION: Craig Tucker

Councillor Chevoppe-Verdier asked officers and partners to ensure that future reports were fully accessible.

ACTION: All report authors

Councillor Chevoppe-Verdier noted the report suggested on page 197 that 2000 employee contracts hadn’t been signed and asked what had happened. Andy Conlan clarified that a sample of contracts had been checked and confirmed all had been signed would have required checking all 2000. He said he would follow this up in the audit plan for 21/22.

ACTION: Andy Conlan

The Chair asked what the basis was for estimating assets and liabilities (on page 88) given the differences between the Council’s numbers and those of the LPFA. Patrick Rowe said the H&F fund had a separate actuary with their own assumptions. Phil Triggs added that it could also be due to the characteristics of the different memberships.

Councillor Chevoppe-Verdier asked if the assurance around information rights was from an audit by the ICO or if it was self-assessed (page 151). Craig Tucker said he could follow up with the service.

ACTION: Craig Tucker

The Chair noted that page 116 showed non-dwelling rents of £40k for 2019/20 but nothing for 2020/21 and asked for an explanation. Sukvinder Kalsi said it was probably due to disposals, but he would check with the service.

ACTION: Sukvinder Kalsi

The Chair asked how much of the increase in rent arrears shown on page 118 was due to Covid and how much was due to other financial issues. Sukvinder Kalsi said the increase reflected the rent increase in 2021 as well as the impact of Covid. He expected this to increase further due to the ongoing cost-of-living crisis.

Councillor Chevoppe-Verdier asked when the new code of practice for local authority accounting came into force and its impact on the cost of audits. Craig Tucker said the code was updated every year and approved by CIPFA. There had been no major changes in recent years, but changes could impact costs if additional work was required, and infrastructure assets were an example of that. Councillor Chevoppe-Verdier encouraged officers to send responses to Government consultations to relevant committees.

ACTION: All officers

Paul Dossett (Grant Thornton) said audit costs were driven by accounting and auditing standards. Two changes were coming on fraud and on risk assessments and estimation. Those will come with the 2022/23 audit.

The Chair noted the delay getting the bank reconciliation process operational (referred to page 195) and asked if it had been resolved. Andy Conlan said it was a recurring issue and he would speak with management to see if there had been progress during the 2021/22 audit. Craig Tucker added that it was being done monthly and updates were being provided to the auditors.

The Chair questioned why the draft letters of representation started ‘Dear Sirs’. Andy Conlan said he would make them more inclusive.

ACTION: Andy Conlan

RESOLVED

1. That the Committee noted the revised Statement of Accounts for 2020/21 (Appendix 1).

2. That the Committee noted that the accounts remain ‘unaudited’ until final sign-off by the external auditor.

3. That the Committee noted the content of the external auditor’s revised ‘Audit Findings Report’ (ISA260), including the auditor’s findings, recommendations and the Council’s response to those recommendations (Appendix 2).

4. That the Committee approved the amended 2020/21 management representation letters (Appendices 3 and 4).