Agenda item

Report No: PAS/SE/16/018

The Committee received Report No: PAS/SE/16/018, which presented the results of Ernst and Young’s (EY) audit of the financial statements for 2015-2016.  The report set out issues EY were formally required to report on to those charged with governance, under the Audit Commission Code of Audit Practice and International Standards on Auditing (ISA (UK and Ireland) 260).

The report also included the results of the work that EY had undertaken to assess the Council’s arrangements to secure value for money in the use of its resources, as the Performance and Audit Scrutiny Committee was charged with governance in accordance with powers delegated to it under the Council’s Constitution.

The Council’s unaudited 2015-2016 statement of accounts, signed by the Council’s Chief Finance Officer (Section 151 Officer) on 30 June 2016, had been updated to reflect adjustments recommended by EY from their audit work.  Members were advised that the adjustments were all immaterial to the overall financial position of the Council and were in most cases, merely presentational changes.

A copy of the Audit Results Report was attached as Appendix A, and was presented to the Committee by Mark Hodgson (Executive Director) and Mark Russell (Assistant Manager) from EY.

Also attached as Appendix B to the report was a Letter of Representation, on behalf of the Council in accordance with the audit of the financial statements for St Edmundsbury Borough Council for the year ended 31 March 2016.

Mr Hodgson confirmed that all work on the audit of the Council’s 2015-2016 financial statements had been concluded and no further errors had been identified.  Therefore, EY would be issuing an unqualified opinion and

certificate this afternoon (21 September 2016), prior to the statutory deadline of 30 September 2016, stating the Council had proper arrangements in securing economy, efficiency and effectiveness in its use of resources. He explained that the St Edmundsbury accounts would be the first set of accounts to be signed off for 2015-2016, and that they were the best that he had seen so far this year.  He wished to thank the Head of Resources and Performance and her team who had been helpful and instrumental in making this a very smooth audit for EY.

However, he wished to draw the Committee’s attention to a couple of key areas:

1)   On page 16 – There had been no unadjusted audit differences.

2)   On page 17 – There were no other matters to report and there were no objections received to the 2015-2016 accounts from members of the public. 

3)   Pages 19, 20 and 21 – The Audit Plan had gained all assurances and all tests and been negative.

4)   On page 22 – Only the standard representations had been requested.

5)   On page 23 – Value of Money – There was one significant risk due to the budget gap over the next 3 – 4 years.  However, the Council had put in place proper arrangements to secure value for money in the use of its resources, and its reserve position was strong.

Members asked a number of questions in relation to the report, to which Mr Hodgson duly responded.

The Chairman, on behalf of the Committee wished to thank the Head of Resources and Performance and the Finance Team for their outstanding work and also wished to thank EY for their audit work.

Councillor David Nettleton moved the recommendation, this was duly seconded by Councillor Beccy Hopfensperger and with the vote being unanimous, it was

          RESOLVED: That

1)   The unqualified opinion on the Financial Statements for 2015-2016 (as set out in the Audit Results Report - Appendix A) issued by the Auditor be noted.

2)   The Value for Money conclusion stating that the Council had proper arrangements in securing economy, efficiency and effectiveness in its use of resources (Appendix A) issued by the Auditor be noted.

3)   The Letter of Representation on behalf of the Council (Appendix B) be approved before the Audit Director issues his opinion and conclusion.

4)   The Chief Finance Officer in consultation with the Chairman be given delegated authority to conclude the signing of the accounts.