Decision details

RESOLVED that the minutes of the meeting of the committee held on the 29 January 2020 be approved as a correct record, and signed by the Chairman.

Arising from the minutes the following questions were asked by the Independent Member to Enst and Young (EY):

Quality control in your audit partner is a key requirement from a client. What are Ernst and Young doing to allay clients’ reservations around 3 issues recently reported in the press. These are:

The regulatory inspection onto EY’s oversight of NMC Health

Questions about the audit of Wirecard

Questions about EY’s role with Kaloti Jewellery International

EY are also one of three firms mentioned in an FRC investigation by London Capital and Finance PLC.

Andrew Brittain the Associate Partner from EY addressed the Independent Members concerns. Due to the size of EY, globally there were a number of these examples that came up every now and then, the ones highlighted by the Independent Member went back over a number of years and covered a number of different Countries. Where regulators were involved EY would cooperate fully with the enquiries and regulator. However, Andrew was unable to comment on the individual cases as these were ongoing.

It did reinforce that by serving the public interest, it was important that there was trust and confidence from the stakeholders that EY reported too both in the public and private sectors and that audit quality was critical. Members were assured that EY were continuing to deliver the best audit quality globally.

Andrew detailed the Government Public Sector Practice which was a dedicated practice across the UK firms and focused on public sector audits. All staff members had been specifically trained and took the matters very seriously. EY ensured that investment had been made in their staff members to ensure that the quality expected was delivered on an ongoing basis.

Also arising from the minutes;

·        The scale of the Joint Venture borrowing would be confirmed once the Business Plan was approved, which was expected to be later on in the year. The Executive would be recommending their preferred partner at their meeting in July.

·        The risk register was yet to go back to CMT since the last meeting.