Please note that Appendices I and II are to-follow.  (Revised versions of Appendix I and II published on 11.9.17)

The Committee considered the report of the Chief Financial Officer which sought the Audit Committee’s approval of the Council’s financial statements for 2016/17, and asked the Committee to consider the external auditor’s Audit Findings Report. 

The Chief Accountant introduced the report, taking Members through the various tables/statements set out in the report on pages 38, 39, 40, 41 42 and 43.  He drew attention to the increase in the value of the Council’s assets of £4m to £4m and the increase in pension liability of £6m, which resulted in a reduction in the value of the Council’s net assets.

The Chief Accountant, Chief Financial Officer and Revenues and Benefits Manager (Technical and Financial) answered questions concerning the future reduction in Revenue Support Grant to zero, and whether it was right for the Council to fund a government service referring in particular to housing benefit.  The Revenues and Benefits Manager (Technical and Financial) referred to the loss of admin grant and that the council tax support assessors were funded from Business Rates, and gave examples of the impact of Universal Credit in Dover and Thanet. She drew attention to the member training session that would be held on this topic, and the implications in terms of the potential for homelessness if assistance was not provided, however, this would be a decision for Members to make.  In response to further comments and questions, the Chief Financial Officer agreed to liaise with the Cabinet Member for Finance and Performance regarding the wording of the introduction; the Deputy Head of Audit Partnership gave an update on the risk management framework; and the Chief Accountant agreed to provide a Member with a copy of the Accounts and Audit Regulations 2015.  A Member drew attention to the fact that the Council had been recognised in the Top 100 Not for Profit organisations to work for in the Best Companies Survey in February 2017, and was only one of three councils nationwide to make the list.

The Chairman thanked the Chief Accountant and his team for their work on the accounts, and invited Mr Iain Murray of Grant Thornton to present the Audit Findings report.  In introducing the report, the Chairman expressed his disappointment about the delay in the Findings Report from Grant Thornton, as the papers should have been circulated with the rest of the agenda to ensure sufficient time for all to review the documents in advance of the meeting.  Iain Murray apologised for the lateness in providing the reports and advised that they would be reviewing their work programme for next year to meet the earlier deadlines.  He thanked the Chief Accountant and his team for their support and the high quality of the accounts and working papers.  He drew attention to page 17 of the report, which set out details of CIPFA’s ‘Telling the Story’ agenda, and explained that this was reported as an Adjusted Misstatement which they were bound to report but it had no impact on the ‘bottom line’.  He confirmed that they would be giving an unqualified audit opinion on both the financial statements and value for money.

Members were invited to ask questions, during which attention was drawn to item 1 on page 15 of the report.  It was confirmed that the Chief Financial Officer was not aware of any fraud investigations and prosecutions during the year, and the report would be amended to reflect that. Attention was also drawn to page 22, and Iain Murray confirmed that there were satisfactory arrangements in place to mitigate risk.

Further discussion ensued regarding page 17 and the new CIPFA requirements and whether the interpretation given by Grant Thornton was correct.  The Chief Financial Officer advised that there had been a difference of opinion but independent challenge was to be welcomed and that was provided by Grant Thornton and Internal Audit.

Resolved:

(1) That the external auditor’s Audit Findings Report, as set out in Appendix I to the report, be noted, subject to an amendment to item 1 on page 15 of the report to reflect that there had not been any fraud investigations and prosecutions during the year.

(2) That the letter of representation, as set out in Appendix II to the report, be approved on behalf of the Council.

(3) That the Statement of Accounts for the year ended 31 March 2017, as set out in Appendix III to the report, be approved, subject to amendments to the wording of the introduction.