Agenda item

Committee received the report of the Head of Financial Services, which sought Member approval for the 2010/11 audited accounts to allow completion of the financial reporting for 2010/11.

Members were advised that, in accordance with the new requirements of the Accounts and Audit Regulations, the draft accounts for 2010/11 had been produced by 30^th June and certified by the Section 151 Officer on that date.  They had then been made available for public inspection and had been externally audited.  The external auditor’s formal report was attached at Appendix A to the report.

Steve Clark, Director, KPMG LLP (UK) informed Members that there were no major issues to report.  The process involved much work for officers and the Authority’s approach worked well, with good quality accounts and supporting working papers.  One material audit adjustment to correct a duplicated entry had been identified in relation to the Collection Fund, but this was purely presentational and had no impact on the fund’s net balance and no impact on the general fund or net assets.  It was anticipated that an unqualified audit opinion would be issued by 30^th September 2011.

Heather Garrett, Manager, KPMG LLP (UK) advised that the report summarised the key issues identified during KPMG’s audit of the Authority’s financial statements for the year ended 31^st March 2011 and the assessment of the Council’s arrangements to secure value for money (VFM) in its use of resources.  It had been concluded that the Authority had made proper arrangements to secure economy, efficiency and effectiveness in its use of resources.  VFM risks were set out in KPMG’s Audit Fee Letter 2010/11 in relation to the financial resilience of the Authority, which was an issue for all local authorities following the comprehensive spending assessment.

Members were advised that the audit was split into four phases, namely Planning, Control Evaluation, Substantive Procedures and Completion.  It focused on the final two stages of Substantive Procedures and Completion and included any findings in respect of the control evaluation that KPMG had to report.  As required by the Code of Audit Practice, the audit had been carried out in an objective and independent manner. 

A number of presentational changes to the notes to the financial statements had been noted.  A full list of significant audit adjustments had been included at Appendix 3, and all of these had been adjusted by the Authority.  Recommendations that would strengthen the Authority’s control environment were detailed in Appendix 1.  It was noted that the Authority was addressing risks and issues appropriately, and that this reporting period had been the first for the Authority under International Financial Reporting Standards and it had responded well.

It was reported that the Council must consider and approve the accounts, then ensure they were signed and dated by the Chairman of Audit Committee by 30^th September 2011.  It was noted that the approval process represented an opportunity for the City Council to consider the outcome of external audit and ensure that its financial reporting was appropriate and any necessary action taken.

The adjusted, audited accounts were attached at Appendix B for Members' consideration and approval, and it was noted that the external auditor required a ‘letter of representation’ in support of completing the audit, which would be signed by the Section 151 Officer.  A copy of the letter of representation was attached at Appendix C to the report.

Members were advised that it was expected the external auditor would issue their opinion on the accounts once they had been approved and the letter of representation forwarded.  Conclusion of the audit would follow in due course.  The Head of Financial Services would ensure that the accounts were published by 30^th September through a copy being made available at the town halls and through the Council’s website.

It was proposed by Councillor Knight and seconded by Councillor Newman-Thompson:

 “(1)     That the report for 2010/11 issued by the Council’s External Auditors and the letter of representation, to be signed by the Section 151 Officer, be noted.

 (2)       That, subject to no comments being received by noon on Monday, 26^th September 2011 that indicate otherwise, the Statement of Accounts for the financial year ended 31^st March 2011 be approved and that the Chairman of Audit Committee signs and dates the Accounts accordingly.”

Upon being put to the vote, Members voted unanimously in favour of the proposition, whereupon the Chairman declared the proposal to be clearly carried.

Resolved:

(1)        That the report for 2010/11 issued by the Council’s External Auditors and the letter of representation, to be signed by the Section 151 Officer, be noted.

(2)       That, subject to no comments being received by noon on Monday, 26^th September 2011 that indicate otherwise, the Statement of Accounts for the financial year ended 31^st March 2011 be approved and that the Chairman of Audit Committee signs and dates the Accounts accordingly.