Agenda item

Report to Follow.

The Committee received and discussed a report form the External Auditor which sets out the Draft Audit Completion Report for the year ending 31 March 2023.

The report sets out progress to date on the audit of the 2022/23 Statement of Accounts. This is presented in the format of a Draft Audit Completion Report and highlights that there is still some work to be finalised before the audit of the 2022/23 accounts can be completed. As the reports advises, there remains only a limited number of areas that still require finalising and the work completed so far does not highlight any major areas for concern.

Danial Watson, External Auditor, informed the Committee that they have now received a signed set of accounts and letter of representation for 2021-22 and that should be signed off this week. They have assurances from the Pensions Fund Auditor which is good news. There is a relatively small error in the Pension Fund where the final version does not show the Council’s proportion of that area of pension Fund assets. He informed the Committee that the Pension Fund requires amendment but that it is due to a timing issue when the Pension Fund Auditor produced their report. The amount is £70 million and the Council has a small share of that amount which will be shown in the final version.

Daniel Watson referred to a few queries left outstanding on the Council’s valuation of Property Equipment which is currently being worked through with the Council’s Finance Team. The main area where there is a change in the accounts is in relation to the Asset Ceiling calculation which is referred to later in the report. With regard to the Valuation of Investment Properties, that is now complete and there are no issues arising. He drew attention to the asset ceiling calculation where the Actuary makes the assumption that the working life of the Council is 7 years. The Council’s Auditor feels that as a public body the working life of the Council should be indefinite which will increase the asset ceiling. The External Auditor is working with the Actuary to get a revised ceiling calculation which will recognise all of the Council’s assets in the final version. It will mean that that the Council has a much larger pension fund surplus. There are no significant findings in the Management of Override Controls. The final area of risk is in relation to the shareholders in the Manchester Airport that work is complete and there are no matters to bring the Committee’s attention.

Danial Watson informed the Committee that the Council has provided a good quality set of accounts in line with agreed timescales and support from the Council’s officers. He referred to the Summary of Misstatements which show relatively small errors and they wouldn’t expect the Council to adjust the accounts for such small errors. Value for money is work in progress.

In response to points raised by the Chair, Daniel Watson informed the Committee that there is work on going at a national level regarding addressing the backlog of audit opinions. Part of this is the Controller Auditor General is looking at the scope of work for local audit for 2023-24 onwards so it is envisaged that the work required in local pensions and property requirements and equipment is reduced thereby giving less delays. Regarding related pay transactions he advised that the External Auditor needs to be satisfied that these are complete and accurate. Where officers circumstances change they need to be picked up when the officers are producing the accounts. With regard to Councillors, they declare their interests at meetings. The External Auditor will make sure that management actions are completed and included in the final accounts.

The Director of Finance informed the Committee that in accordance with the Committee’s wishes from the previous meeting, a letter was written to the Greater Manchester Pension Fund regarding the delays in the pension fund but a response had not yet been received.

Resolved – that the Committee notes and endorses the Draft Audit Completion Report by the External Auditor.