Issue - meetings

Report attached.

The committee is asked to discuss the report and any other matters which may influence the audit carried out by Ernst and Young.

The Chairman agreed to consider Ernst & Young’s audit plan as the first item of business.

The report was the first audit plan presented to the committee since external audit services had transferred from the Audit Commission to Ernst & Young.  It provided the committee with an opportunity to review the proposed audit approach and scope for the 2013 audit.  The report summarised the key risks driving the development of an effective audit and outlined the planned audit strategy in response to those risks.

Mrs A Ockleston, Audit Manager, Ernst & Young, explained that they had to give a value for money opinion and that the key changes were council tax and business rates, which were not such a risk for the council but had potential to cause problems.  Similarly, there was a very low risk of fraud but should it occur the effect could be substantial.

Responding to questions, Mrs Ockleston stated that:

·        any supplementary fee in relation to additional work to gain assurance over the new fixed asset module may amount to £2,000 to £4,000 but the council would only be charged the actual cost in addition to the indicative fee of £63,348 for the audit;

·        the fee on grant work was based on the assumption that auditors identified no problems but could incur a fee in the event of problems.

Mrs Ockleston explained that different processes and methods, such as analytics, were now available to auditors since the transfer to Ernst & Young.  Analytics was a computer-based tool in worldwide use that could capture whole populations of financial data and target risk areas.

The committee noted the report.