Agenda item

To receive the External Audit - Audit Results Report.

The Committee received the draft annual Audit Results report from the 2021 Audit. The External Auditors attended the meeting, and Andrew Brittain and Tom Archer of Ernst & Young presented the report.

It was highlighted, that page 13 of the report updated the scope and status of the audit, the substantial part of the audit had been completed, but there were still some areas outstanding. As in previously years, the most significant part of the outstanding areas was the liability of the pension fund, and final conclusions from Deloitte LLP had still not been received. An IS19 assurance letter had been received by Ernst & Young, but it had been caveated that the audit of Windsor & Maidenhead and the Royal County of Berkshire Pension Fund had not yet been completed, and until that was complete material issues could arise. The letter had highlighted, as in previous years, that there was a difference in asset values and issues in membership data. It had been hoped that after the plan had been presented to the Committee in January that these issues wouldn’t arise again this year, but unfortunately, they had.

The outstanding issues surrounding Property, Plant and Equipment assets had been resolved, however an audit different had been identified relating to the value of one of the Councils properties. This steamed from an incorrect land value being used, it was note that the difference was not material but was above the threshold of what needed to be reported to the Committee and would be included in the final audit report. A second issue had since arisen since that publishing of the agenda, the issue was that Local Authorities were not writing out the gross cost and associated depreciation on highway infrastructure assets. This most commonly occurred with the upgrading of road surfaces. CIFCA had been included in discussions and were considering options, which could be enhanced guidance or amendments to the code. In the meantime, Local Government Audit firms have paused signing opinions on Councils with material infrastructure assets which would include Bracknell. This had been discussed with management and based on discussions with management and work already undertaken, it was believed that there was sufficient assurance that Bracknell were accounting for this correctly and in accordance with the CIFCA code, therefore it was being discussed internally to whether the current pause should apply to Bracknell, Officers and Members would be informed once this had been resolved.

The fees relating to the audit had been outlined within the report, and there were some areas that were yet to be quantified. There had been a change this year with PSAA who determined scale fees, and changes, had issued guidance in advance regarding some of the incremental areas highlighted in the audit plan.

Arising from the Committees comments and questions, the following points were made:

·       Deloitte’s had indicated to RBWM that they were pushing completion back into the summer, Discussions were being held to whether the caveat in the letter could be removed earlier than that.

·       The property value different came to £1.8m and was above the levels of reporting, this would be outlined within the final report.

·       When Deloitte’s took over the pension fund, they highlighted a number of issues, including control issues around the fund itself. It had been reported that there were less issues reported this year, which it was hoped was a step in the right direction.

·       These were circumstances outside the control of Ernst & Young.

·       Internal Audit would be responsible for looking at the dispensing of Covid Grants.

·       There had been increased discussion surrounding cyber-attacks since the invasion on Ukraine by Russia. Supply chain and energy price impacts were also filtering through as flagged risks.

The Committee noted the report.