To consider the report of EY, the council’s external auditor.
Kevin Suter from EY presented two audit result reports for both councils. The report informed the committee of audit findings, in order to inform the sign off of the statement of accounts.
Kevin had reported that there had been improvement in the accounts sign off timings after a challenging few years, and he thanked the officers involved for their support of the audit process, which had led to improvements.
Kevin summarised the main findings for South Oxfordshire District Council:
· The audit had been substantially completed, with a few amendments made and the documents had been corrected and the committee was provided with the final versions for signing at this meeting.
· Key areas of risk were presented in January and this was reported in the document. The details can be found in the reports. In summary, Kevin was pleased to report no identified fraud, and also commented on some errors identified that had since been corrected by officers, which were down to error or gaps in knowledge / experience.
· On page 21, there were two findings regarding the estimate – one was yield used in the valuation of a property, the second finding was on process – a detailed valuation report hadn’t been obtained from the valuer. Management had responded appropriately to ensure it would not happen again.
· Page 22 – pension valuations: gross liability estimates were made by EY – no issues reported.
· Page 23 – there were two issues, firstly an existing CIL accounting issue was being worked on, to ensure resolution. There was one small error reported, which was a significant improvement from the previous year. Secondly, Covid related grants, which were a new scheme, were considered by audit, taking into account how those funds were handled. EY considered that this was well managed by the council.
Overall, the few errors found were viewed as immaterial and officers were asked to respond to those to explain why those should remain unadjusted for committee approval. The unqualified opinion was in section three of the report.
The value for money arrangements were set out in section five of the report. Financial sustainability was the issue identified. The council had acknowledged previous advice, so the direction of travel was positive on this issue and was improving as the auditor would expect to see.
Small error identified in graphs on page 35. Data was for the 2021 MTFP (yellow) and the 2022 MTFP update (grey).
The financial environment was still challenging and uncertain in Local Government – this will remain an area of focus as the challenges were still present – however it was concluded that the auditor was satisfied and that the council had appropriate arrangements in place.
Committee members were invited to ask questions.
· It was confirmed that the data model for business rates had been corrected, and the accounts were now correct. A checking service will be used in future for business rates.
· Thanks were given to Kevin Suter and to the officers for quick responses to the findings.
· Positive feedback given on the report style. Suggested adding an appendix for acronyms.
· The risk of inflation was raised by a committee member – how would the council deal with that in future.
Kevin Suter introduced the report for Vale.
The key messages are similar to South. The corrections had been made and were presented ready for account sign off tonight.
· The risk identified was a duplicate accrual. A recharge issue as at South was identified at Vale too, and management has amended this for both councils. The detailed valuation report was also flagged as it was for South.
· CIL accounting issues had been resolved, and the auditor confirmed that Covid funding had been handled well.
· The unqualified opinion was given at section three of the report.
Value for money at section five - as at South, auditors had identified that managers were consistently applying process to challenge their budget assumptions and projections. The positive direction of travel means that the auditor was satisfied that Vale had appropriate arrangements in place. The uncertainty and challenges were still to be a focus for the council – the same message as South.
In response to a question, Richard Spraggett responded that the £2.9 million asset not on the register was a community centre that was given to the council by developers for £0 and was therefore not on the register. The new valuation means it had been added to the register.
The committee members for South Oxfordshire District Council received the audit results report 2020-21 from EY and approved of it.
The committee members for Vale of White Horse District Council received the audit results report 2020-21 from EY and approved of it.