Agenda item

Report of the External Auditor, Grant Thornton – to follow

The Committee considered a report of the External Auditor, Grant Thornton, on the Audit Findings for the City Council for the year ending 31st March, 2017. Mark Stocks and Simon Turner, of Grant Thornton, attended the meeting to present their report.

The report highlighted the key issues affecting the results of Coventry City Council and the preparation of the group and financial statements for the year ending 31^st March 2017.  It was also used to report their audit findings to management and those charged with governance in accordance with the requirements of International Standards on Auditing (UK and Ireland) 260, and the Local Audit and Accountability Act 2014.

Under the National Audit Office Code of Audit Practice, the External Auditors were required to report whether, in their opinion, the Council’s financial statements gave a true and fair view of the financial position of the Council and its income and expenditure for the year and whether they had been properly prepared in accordance with the CIPFA Code of Practice on Local Authority Accounting.  They were also required to carry out sufficient work to satisfy themselves on whether the Council had made proper arrangements to secure economy, efficiency and effectiveness in its use of resources (“the value for money (VFM) conclusion”).

The Committee were advised that the audit was substantially complete, although procedures were being finalised in respect of the testing of leases; review of the final version of the financial statements; obtaining and reviewing the management letter of representation; updating post balance sheet events review, to the date of signing the opinion; and the whole of Government Accounts.

The Committee were also informed that in light of the ongoing work relating to leases, it would be necessary to defer consideration of the ‘Audited 2016/17 Statement of Accounts’, to the next meeting of the Committee on 11^th September. The Committee were assured that this acceptable since the Statement of Accounts was required to be signed off by the statutory deadline of 30^th September, 2017.

The Auditor had identified two adjustments affecting the Council’s financial position. The draft financial statement for the year recorded total comprehensive income and expenditure of £60,942k, the audited financial statements showed a figure of £57,746k. A number of adjustments were recommended. Reference was made to the fact that the Council had produced draft accounts to a good standard with an overall high level of compliance with disclosure requirements. Identified errors and omissions, which did not impact on the Council’s overall financial position, had subsequently been corrected. It was anticipated that an unqualified opinion in respect of the financial statements would be provided.

The report highlighted that the Value for Money work was complete and the External Auditors had concluded that the Council had in place proper arrangements to secure economy, efficiency and effectiveness in its use of resources.

Matters arising from the financial statements audit and the review and the review of the Council’s arrangements for securing economy, efficiency and effectiveness in its use of resources had been discussed with the Director of Finance and Corporate Services. A number of recommendations had been made which were set out in an Action Plan attached at Appendix A to the report. These recommendations had been discussed and agreed with the Director of Finance and Corporate Services and the Finance Team.

RESOLVED that:

1.   The Audit findings, as presented by the Council’s External Auditor, be noted.

2.   It be noted that the Audited 2016/17 Statement of Accounts was to be deferred to the next meeting on 11^th September, 2017.

3.   A full updated Audit Findings Report 2016/17 be submitted to 11^th September meeting.