Agenda item

To receive and consider the Audit Progress report from the Council’s External Auditors.

The Committee received a report from Mazars, which set out the audit progress and conclusions of the appointed External Auditor for the Council’s Statement of Accounts (year ending 31 March 2023). The Committee noted that the External Auditors anticipated that the final audit completion report and audit opinion would be completed in January 2024.  It was noted that the External Auditors had reviewed the Audit Strategy Memorandum and had not identified any new significant risks or areas of management judgement. 

The Committee received an update on control weakness identified and noted that, following the external audit review of the Cheshire Pension Fund auditor letter, Grant Thornton had identified a control weakness as a result of the Cheshire Pension Fund not being able to agree the total number of active, deferred pensioners, dependents and undecided Members which had been submitted to the actuary back to the underlying information system which the Pension Fund maintained. It was noted that appropriate assurance had been obtained over the completeness and accuracy of the data used in the actuary in relation to the pension figures and this was not a material misstatement. It was confirmed that the issue would be raised in a control recommendation in the final audit conclusion report. Cllr Gorman confirmed that both he and Cllr Snowball were members of the Cheshire Pension Fund and would take back the concerns raised to their next meeting.

The Committee queried the Council’s position on valuations of property and assets (rolling revaluation model) which sees all land and buildings revalued in a five-year cycle. The Committee requested a written response from the S151 to seek reassurance on the Council’s position and confirmation that valuations of assets were relative to the assets current condition.

The Committee noted the internal control recommendations outlined within the report particularly in relation to expected credit loss provision in respect of housing benefits and adult social care debt which had been calculated based on percentages from 2019. Mazars recommended that this percentage be updated annually to reflect the current profile of debt and the potential effect this had, taking into account economic conditions. The Committee requested that a written response be provided and shared with the Committee from the S151 Officer.

The Committee noted that two internal control recommendations related to the end of year accounts which had not been signed as reviewed, and the payroll bank reconciliation hadn’t been signed as prepared. The Committee agreed that this was an important recommendation that needed to be addressed, with reconciliations being signed as prepared and reviewed on a timely basis. The Committee requested that the S151 Officer provide the Committee with a written response on this matter.

It was reported that, following the verbal update provided to the Committee in September 2023 where a perceived risk of significant weakness relating to the arrangements in financial sustainability was highlighted, Mazars confirmed that having obtained a detailed understanding of how the Council was planning to reduce its forecast, the management arrangements in place and challenging the delivery of the mitigations identified, they considered that there was no actual significant weakness in the Council’s financial sustainability arrangements however the Council’s financial position for 2023-24 was acknowledged as challenging. It was confirmed that the role of the External Auditor was not to make comment on, or to determine what the future financial position of the Council would be, but to determine whether or not the Council was addressing risks and that there was value for money in the actions being taken. It was agreed that officers would arrange training for the Committee on the role of external audit.