Agenda item

External Audit Progress Report

This report provides the Committee’s September 2022 meeting with:

•an update in respect of 2019/20 value for money (VFM) work;

•an update in respect of 2020/21 remaining audit work;

•an update in respect of 2021/22 audit work; and

•a summary of recent relevant reports and publications for your information (Section 2).

External Audit Progress Report

(A copy of the progress report has been filed with the signed minutes).

The External Audit progress report provided the Committee’s September 2022 meeting with:

•an update in respect of 2019/20 value for money (VFM) work;

•an update in respect of 2020/21 remaining audit work;

•an update in respect of 2021/22 audit work; and

•a summary of recent relevant reports and publications for your information (Section 2).

C. Waddell drew members’ attention to the main points in the report. 

He reported that the conclusions in respect of the Council’s value for money arrangements remained outstanding for the 2019/20 financial year. 

In terms of the 2020/21 accounts this work was fundamentally complete.  There was an issue regarding the note that had set out how much senior officers were paid which related back to the S114a report and the International allowance.  External Audit were looking carefully into the wording of the Code of Practice and Audit Regulations to establish clearly what must be included in the note.  If there was sufficient disclosure within the accounts around the Section 114a notice, then the implications of that would not result in the External Auditor qualifying the accounts in relation to this.  It was envisaged that conclusions reached would be reported formally when the audits were concluded hopefully later in the year, subject to the infrastructure issue being resolved.  One other issue within the 2020/21 accounts was exit packages, with External Audit examining the information recently received to determine if further disclosure was needed. 

The infrastructure issue was still not resolved and impacting on most local authorities.  Until a solution was found accounts could not be signed off.  It was reiterated that this was a national issue and not specific to Northumberland.

In a response to a query from Councillor Dale, it was confirmed that External Audit were examining the Caller Report and the Section 114 notice and various other issues gathered over the course of the last two years while trying to pin down the year it related to either the 2019/20, 2020/21 or 2021/22 account.  It was envisaged that most outstanding issues related to the 2019/20 accounts but not all.  However, External Audit would strive to try to capture it all together including the value for money Group Accounts to hopefully speed up the process.  It was noted that value for money applied to the County Council not Advance Northumberland but would apply in terms of some of the issues raised by the previous External Auditor and the Caller Report around governance arrangements for Council subsidiary companies.

Councillor Jackson commented that there had recently been a resolution of an employment tribunal in relation to Advance Northumberland and questioned whether the outcome would have any bearing on the value for money view and that of the Council’s Group position.  C. Waddell confirmed that he was not aware of the resolution as he was not Advance Northumberland’s auditor, it was carried out by another team within Mazars.  That team would conclude on the implications from the tribunal in the context of Advance’s accounts which would then be consolidated through into the Group.  Separate Group instructions would then be issued, and their file would be reviewed.  Depending on the resolution from the tribunal, that would determine whether there was any impact on the value for money opinion judgment around the County Council.  However, Advance Northumberland’s value for money was separate but their accounts were reported to the Northumberland Audit Committee.  Councillor Jackson stated that he would pick up this issue at that time.

RESOLVED that the External Audit Progress report be noted.