Issue - meetings

Report of the Director – Finance and Corporate Services

Mr Surridge from Mazars, the Council’s external auditors presented the Annual Audit Letter along with the Council’s Value for Money arrangements.

The report summarised the progress of the external audit process for the financial year 2021/22. Mr Surridge advised the Group that no actions are required in relation to the report other than a misstatement and an unadjusted misclassification were identified as a result of new guidance issued in relation to infrastructure assets. In relation to pensions the Group were also advised there was a non-material misstatement arising form a revised pension report which was issued during the audit. The Group were asked to note the report was positive with no major concerns.

With regards to the Value for Money arrangements Mr Surridge explained that as part of their work the auditors are required to consider whether the Council has made proper arrangements for economy, efficiency and effectiveness in its use of resources, reporting on the following criteria:

Financial Sustainability – how the Council plans and manages its resources to ensure it can continue to deliver its services

Governance – How the Council ensures that it makes informed decisions and properly manages its risks

Improving economy, efficiency and effectiveness – How the Council uses information about its costs and performance to improve the way it manages and delivers its services

Mr Surridge informed the Group there are no indications of significant weaknesses in the Council’s arrangements for financial sustainability.

Members of the Group asked a specific question relating to the cash reserves and what was the logic for holding such large cash reserves. The Director – Finance and Corporate Services explained the reserves are earmarked for the medium-term financial strategy and are linked to risk and the Council’s future capital plans.

Members questioned the misclassification of assets and whether this would have any effect on the council’s accounts further down the line. The Group were advised the misclassification related to infrastructure assets that were misclassified and the adjustment provides no burden to the taxpayer.

The Group noted a typo error in the Mazars Annual Audit Report of an extra £4m in Government Grants for 2022/23 which had been tabled within the Capital Programme under General Fund.

It was RESOLVED that Governance Scrutiny Group note the receipt of the Annual Audit Letter