Update on 2020-21 Audit of the 2020-21 Statement of Accounts
To receive a verbal update.
Minutes:
Update on 2020-21 Audit of the 2020-21 Statement of Accounts
C. Waddell from Mazars gave a verbal update to the Audit Committee.
Regarding the 2019/20, the opinion on the financial statement had been issued some time ago but not the Value for Money conclusion. This was partly due to some of the issues that had been discussed today around International. The Value for Money conclusion was currently being drafted based on a combination of the Section 114, Section 114 (a) and the Solace report. It was envisaged that there would be an adverse Value for Money conclusion for 2019/20. Work was currently taking place to ensure issues identified from these reports were placed in the correct financial year.
For 2020/21 the accounts were progressing well, and a lot of the testing carried out was now complete. The paperwork on Advance Northumberland had now been signed off. There was some additional top testing to do following some differences identified between the Group accounts and Advance accounts. Work was taking place around some of the disclosures in the 20/21 accounts notably about senior officers’ remuneration and issues around some of the exit packages. It was hoped that once this had taken place testing could be concluded. However, the audit would still not be concluded as depending on the issues arising from the 2019/20 these could flow through to 21/22 accounts.
The technical accounting issues arising principally because of information availability relating to infrastructure assets was still a national issue. Until this was resolved, most audit firms were pausing issuing opinions which were outstanding for 2020/21.
The Audit Committee were reminded of the recent Code change where auditors had moved away from a qualified/unqualified value from any conclusion to either a significant weakness existed, or it did not. If deemed a weakness did exist, then there would be the need to issue a recommendation and consider the issues raised from the 2019/20 accounts as part of that consideration.
The proposal was to bring the 2021/22 audit plan to the September meeting of the Audit Committee with audit testing carried out by December, although this would result in the November deadline being missed.
The Chair commented on the reporting of infrastructure assets and the need for the issue to be resolved quickly. He felt reassured that it was not just a problem for Northumberland.
Councillor Dale questioned if the geographical size of the county would place Northumberland in a disadvantage compared to other local authorities when assessing infrastructure assets. It was confirmed that there was a set procedure in place which would determine the size of the sample taken. The issue regarding the derecognition of parts of infrastructure assets following 'replacement' expenditure was a complex and serious issue, with a resolution yet to be found.
Members were also advised of correspondence received over the last week from Northumberland County Council and a member of the public. No formal question of objection had been made but External Audit would track to see if the issue was resolved.
RESOLVED that the information be noted.
At this point J. Willis, C. Waddell and R. O’Farrell left the meeting.