Agenda item

Audit Completion Report: Year Ending 31 March 2019

Minutes:

Consideration was given to a report which presented the Council’s draft Audit Completion Report for the year ending 31 March 2019 as prepared by the External Auditor, Mazars LLP.

 

The report advised of the key issues related to the audit of the 2018/19 Statement of Accounts.  The detailed scope of the work as the appointed auditor for 2018/19 was set out in the National Audit Office’s (NAO) Code of Audit Practice.  The external auditor’s responsibilities and powers were derived from the Local Audit and Accountability Act 2014 and as outlined in the Audit Strategy Memorandum.  The audit was conducted in accordance with the International Standards of Auditing (UK) and focused on audit risks that the external auditors had assessed as resulting in a higher risk of material misstatement. 

 

The report outlined the detailed findings from the auditors’ work on the financial statements and the conclusion on the Council’s arrangements to achieve economy, efficiency and effectiveness in its use of resources.  The report included the conclusions on the audit risks and areas of management judgements.

 

At the time of drafting the report, the audit of the accounts had been substantially completed, however, several items remained which required resolution.  These items were in the main outside the control of the Council and included investment property, pension liability, long term investments, testing of general IT controls and signed final statements and management representation letter.

 

The scope of the work which included identifying significant audit risks, key audit matters and other areas of management judgement was outlined in the Audit Strategy Memorandum considered by the Audit Committee on 10 January 2019.   Consideration was given to an additional area of management judgement as part of the audit which was the methodology and assumptions underpinning the Council’s valuation of its investment in Manchester Airport Holdings Limited.

 

The external auditors would issue an unqualified opinion.  The period of inspection for objections had passed and no objections had been received.  The external auditors were grateful for the level of cooperation and the high-quality statements.  The accounts had been ready well in advance of the deadline.  There were some outstanding issues, but these had reduced since the time of the production of the report.  The external auditors were still waiting for the outcome of a national issue related to pensions and those liabilities may need to be taken into account on the valuation.  A report on the final position was due later in the week and was likely to have an immaterial difference to the accounts.

 

Section 3 set out the risks and with the exception of the pensions issue referred to earlier there was nothing to be reported.  The investment in Manchester Airport Group referred to in the report had been resolved.

 

Other than some non-material adjustments as described in Section 5 of the report, there were no significant matters arising from the audit of the Group Financial Statements consolidation process.  There were internal control recommendations.  The external auditors highlighted pension liability, MioCare and Unity Partnership.

 

The Value for Money Conclusion was a positive statement.  The Council had arrangements in place for effective use of resources and managed its finances effectively.  The external auditors referred to the Ofsted outcome and concluded that it did not qualify as a risk.

 

The external auditors expressed their sincere thanks for the significant support and assistance of the Council’s finance team.

 

RESOLVED that the draft Audit Completion Report for the year ending 31st March 2019 be noted.

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