To consider the Annual Audit Letter for the year ended 31st March 2018 (copy attached). Representatives from Ernst & Young will be in attendance at the meeting.
The Chairman welcomed to the meeting Ms. Justine Thorpe of Ernst & Young who presented the external auditor's annual audit letter for the year ended 31st March 2018. The purpose of the annual audit letter was to communicate to Members and external stakeholders, including members of the public, the key issues arising from the work of the external auditor which it was felt should be brought to the attention of the Council. It was noted that the annual audit letter had to be published on the Council’s website by the end of October, 2018
The Committee was advised that the areas of work covered by Ernst & Young had been:
· To provide an opinion on the Council’s financial statements – where the auditor had given an unqualified opinion – The auditor was of the opinion that the financial statements gave a true and fair view of the financial position of the Council as at 31st March, 2018 and of its expenditure and income for the year then ended.
· To provide an opinion on the consistency of other information published with the financial statements – The auditor had stated that other information published with the financial statements was consistent with the Annual Accounts.
· To conclude on the Council’s arrangements for securing economy, efficiency and effectiveness – The auditor had concluded that the Council had put in place proper arrangements to secure value for money in the use of its resources.
The annual audit letter also set out key areas of significant risk, which had been tested. These included:
· risk of fraud in revenue and expenditure recognition
· risk of management override
· property, plant and equipment valuation
· pension liability valuation
The auditor’s testing had identified no mis-statements from revenue and expenditure recognition, no material weaknesses in controls or evidence of material management override and no material mis-statements from inappropriate judgements being applied to the property valuation estimates.
Areas of work where reports would be provided by exception included:
· Consistency of the Annual Governance Statement – The auditor was of the opinion that the Annual Governance Statement was consistent with the auditor’s understanding of the Council.
· Public interest report – The auditor had no matters to report in the public interest.
· Written recommendations to the Council, which should be copied to the Secretary of State – The auditor had no matters to report.
· Other actions taken in relation to the auditor’s responsibilities under the Local Audit and Accountability Act 2014 – The auditor had no matters to report.
· Reporting to the National Audit Office on review of the Council’s Whole of Government Accounts return – The auditor had no matters to report.
The Committee was also advised that the Audit Results Report had been issued on 30th July, 2018 and a certificate of completion of the audit had been issued on 31st July 2018 in accordance with the requirements of the Local Audit and Accountability Act 2014 and the National Audit Office’s 2015 Code of Audit Practice.
Members were informed that, in November 2018, the auditor would also issue a report to those charged with governance of the Council summarising the certification work undertaken on the 2017/18 housing benefits claim.
RESOLVED: That the Annual Audit Letter for the year ended 31st March, 2018 be noted.