Decision details

The Executive Manager – Finance and Corporate Services submitted a report requesting that the Corporate Governance Group received the report to those Charged with Governance and determined what comments, if any, should be referred to Council along with the Statement of Accounts. It was noted that the Council had continued to maintain a good quality Statement of Accounts and supporting working papers and that no significant issues had been identified during the audit.

The Executive Manager advised that as part of the final accounts process KPMG as the Council’s appointed auditor, provided a detailed report on the conduct of the audit of the final accountsalongside representations on specific matters such as the Council’s financial standing and whether the transactions with the accounts were legal and unaffected by fraud. The Report to thoseCharged with Governance, which covered these issues was attached as an appendix to the officer’s report. It was noted that over the past few years significant improvements had been made to the year-end closedown process resulting in both a good quality Statement of Accounts and supporting working papers. This approach had helped the Council meet the new statutory deadline with the financial statements now having to be made available by 31 May and finalised for publication by the 31 July. The officer’s report confirmed the improvement has been maintained which had assisted with a speedier closedown process leading to more time to quality assure documents and making the audit process more efficient.  The Executive Manager advised that KPMG’s Annual Governance Report 2017/18 confirmed an unqualified audit opinion would be issued along with a positive value for money conclusion.

The Executive Manager provided members of the committee with an overview of the Statement of Accounts that was attached as an appendix at agenda item 7 of the committee’s agenda pack. Councillor Lawrence asked for a breakdown of the amount of income received from Government grants. The Executive Manager advised that this source of income was rapidly disappearing and that 47% of money received from Government grants was for the payment of housing benefit payments that the Council administered. Councillor Lawrence also asked about the “unusable reserves” that were referred to in the report. The Executive Manager provided information on these noting that they were in effect notional and accounting figures only. Councillor Clarke enquired how much of the Council’s income was controllable and non-controllable. The Executive Manager advised that it was very hard to differentiate between controllable and non-controllable, as there were so many variables involved.  Councillor MacInnes asked about the decline in income from investment properties and was advised by the Executive Manager that this was due to the loss of income from tenants in the former Civic Centre building. The Chairman asked how often the Council’s investment portfolio was reviewed and refreshed. The Executive Manager advised that officers worked with Arlingclose, who advised the Council on Treasury Management to regularly review where investments were made.

Mr Andrew Bush and Mr Alistair Collston of KPMG, the Council’s external auditors, presented their Annual Governance Report 2017/18, which had been circulated prior to the meeting, and attached as an appendix to the officer’s report, which provided headline findings and information. Mr Bush thanked the Executive Manager and the finance team for their support throughout the audit process.

The Chairman asked about the Council’s Asset Investment Strategy which included the loan to Nottinghamshire County Cricket Club and the risks involved. Mr Bush advised that risk levels varied across all investments but that the risk that the Council was exposed to was at an acceptable level, he also assured the committee that KPMG, as the Council’s external auditors were fully satisfied with the governance arrangements for managing the Cricket Club loan. The Chairman also asked whether it was possible to have a more detailed breakdown on the specific risks linked to each individual investment property. The Executive Manager advised that information on this had been provided at previous meetings of the Corporate Governance Group and that while risk varied between investments, reassured the committee that all risk had been properly and diligently assessed. The Chairman asked whether the risk for each investment could be shown on a scale of risk. Mr Bush advised that risk in this context was either significant or not, and as such could not be broken down further.

The Chairman and members of the committee thanked Mr Bush and Mr Collston for their excellent work in preparing the Annual Governance Statement and for attending the meeting to answer their questions.

It was RESOLVED that the External Auditor’s Report to those Charged with Governance 2017/18 be supported.