Agenda item

The Audit Committee received the Audit Strategy Memorandum for Oldham Metropolitan Borough Council for the year ending 31^st March 2025, from the external auditors Forvis Mazars.

The report summarised their audit approach, including the significant audit risks and areas of key judgement which they had identified, and provided details of their audit team. In addition, as it was a fundamental requirement that an auditor is, and is seen to be, independent of an audited entity, the section of the report titled ‘Confirmation of our independence’ summarised their considerations and conclusions on their independence as auditors.

Two-way communication with the Council was described as being key to a successful audit and is important in:

a.    Reaching a mutual understanding of the scope of the audit and our respective responsibilities.

b.    Sharing information to assist each of us to fulfil our respective responsibilities.

c.     Providing you with constructive observations arising during the audit process.

d.    Ensuring that we, as external auditors, gain an understanding of your attitude and views in respect of the internal and external operational, financial, compliance, and other risks facing Oldham Metropolitan Borough Council which may affect the audit, including the likelihood of those risks materialising and how they are monitored and managed.

With that in mind, the submitted report, which had been prepared following their initial planning discussions with management, was intended to facilitate a discussion with the Council on their audit approach.

Forvis Mazars were appointed to perform the external audit of Oldham Metropolitan Borough Council (the Council) for the year ending 31^st March 2025. The scope of their engagement was set out in the Statement of Responsibilities of Auditors and Audited Bodies, issued by Public Sector Audit Appointments Ltd (PSAA), which was available from the PSAA website: Statement of responsibilities of auditors and audited bodies from 2023/24. The responsibilities of the external auditors were principally derived from the Local Audit and Accountability Act 2014 (the 2014 Act) and the Code of Audit Practice issued by the National Audit Office (NAO).

The external auditors were responsible for forming and expressing an opinion on whether the financial statements had been prepared, in all material respects, in accordance with the Code of Practice on Local Authority Accounting. Their audit does not relieve management or ‘Those Charged With Governance’, as those charged with governance, of their responsibilities.

The Director of Finance is ultimately responsible for the assessment of Oldham Metropolitan Borough Council’s ability to continue as a going concern.

The 2024 Code now requires the auditor to issue the draft Auditor’s Annual Report by 30^th November following each year end. For the 2024/25 audit, this means that they must issue their draft Auditor’s Annual Report by 30^th November 2025, whether their audit was complete or not. In instances where the audit work was not complete by 30^th November for any given year, the 2024 Code required external auditors to provide a summary of the status of the audit at the time of issuance and should reflect the work completed to date. In such instances, they would issue an Interim Auditor’s Annual Report to meet the 30^th November deadline. On completion of any outstanding financial statement audit work or Value for Money arrangements work, the auditors will re-issue the Auditor’s Annual Report which will include an updated commentary on Value for Money arrangements.

RESOLVED: That the report be noted.