Agenda item

(Report of the External Auditors - Grant Thornton)

Mr John Gregory, External Auditor, presented Grant Thornton’s Audit Findings Report for year ending 31 March 2018 and explained that under the International Standards of Auditing they were required to report whether in their opinion the Council’s financial statements give a true and fair view of the Council’s position and Council’s expenditure and income for the year have been properly prepared in accordance with the CIPFA/LASAAC code of practice on local authority accounting and prepared in accordance with the Local Audit and Accountability Act 2014.  Also, whether other information published is materially inconsistent with the financial statements or their knowledge obtained in the audit or otherwise to be materially misstated.

Mr Gregory said this was the first year that all local authorities have been asked to publish their Statement of Accounts with Auditor’s findings by 31 July and only 85-90% will have met this deadline but Lichfield District Council had met this deadline which was a good thing.  Mr Gregory focussed on the key points within the report. Minimal amendments had been made to the financial statements as a result of the audit. Work had still been ongoing at the time of writing the report to determine whether the Council’s approach to accounting for the pension liability relating to the staff that transferred under TUPE for the outsourcing of the Leisure Services was appropriate.  Mr Gregory explained that the Statement of Accounts had been prepared on the basis that the actuarial risk for the individuals had transferred to the provider along with the employees and so it was no longer the Council’s risk and so no longer a Council liability for their pension.  Mr Gregory was now able to confirm to the committee that after very careful consideration of this, the External Auditor’s view was that this had been treated correctly in the Statement of Accounts and no changes were to be made, the issue had been satisfactorily resolved and they were happy with how this matter had been recorded.

The Value for Money key findings was discussed as the Friarsgate Development had now been discontinued and the External Auditors had reported that they were satisfied that the Council had a clear chain of reporting and governance in place regarding the Friarsgate development and that regular updates had been provided.  They felt the Council’s forward financial planning was not reliant on the success of this and so the decision to not continue had no detrimental effect on the Council’s financial plans.  They therefore concluded that for the 2017/18 year the risk had been sufficiently mitigated and Lichfield District Council had proper arrangements to secure value for money.

Members were relieved on this opinion and asked if the report would be updated to reflect this new verbal opinion around pensions.  Mr Gregory said the neatest way to deal with this update would be to update the Annual Audit Letter to reflect these new findings and opinion and this was noted.

Members felt a lot was to be learnt from the Northamptonshire Report distributed some time ago about visibility of audit and audit trails.  The Chairman said he was very keen to examine anything with limited assurance so something can be done before it is too late.  The Minutes of the Audit & Member Standards meetings were felt to be very important to show the lines of accountability and it was confirmed that the Minutes were now more detailed and presented to Council as well as on the website for the general public.  Councillor Spruce commented that the reduced timescales within which to produce this detail had been very demanding and congratulated Mr Thomas and his team who had dealt with a lot of change so late in the day.  Councillor Spruce felt the clean Audit Statement was something everyone should be incredibly proud of and the committee wholeheartedly agreed.

RESOLVED: The Committee noted the External Auditor’s Audit Findings

                      Report.