Agenda item

To  receive an update from the External Auditors on work undertaken to date  and to note the Audit fee 2017/18.

Helen Thompson and Malcolm Haines, Ernst and Young, presented a report from the External Auditors, which set out the Annual Audit Fee for the  2017/18 Audit and a progress report on work undertaken since the last Committee meeting in March 2017.

Since the External Audit Plan had been presented to the Committee at the meeting on the 29 March 2017 the interim visit had taken place during March 2017 which had produced no issues to report to Members.

The year end audit visit had started the week commencing 26 June 2017, with the final report due to come to the Committee at the meeting on 26 July 2017. The visit would progress over the next few weeks, with any major issues found being  reported to the Borough Treasurer and the Chair.

The Grant Certification Work was underway, with the Council’s housing benefit team undertaking the initial testing. Completion of the work was expected by August 2017 which was significantly earlier than previous years and well ahead of the certificate deadline of 30 November 2017.

Since the report had been written the outcome of the PSAA Ltd tender had been decided with Ernst and Young winning lot 2, which Ernst and Young were content with.  The PSAA website set out the timetable, with auditors being provisionally allocated to councils at the end of July 2017 and consultations happening in August. The PSAA had set the principle that they would not change Councils and Auditors for change sake but any Local Authority preference would be taken into account especially where Local Authorities had shared service arrangements. The Council would know who would be their Auditors for 2018/19 by the end of 2017.

The Grant auditor would be appointed directly by the Local Authority. DWP had issued guidance to assist with the  process.

As a result of the Members’ questions and comments the following points were made:

• The Council can appoint the PSAA Auditor to also undertake the Grant work and set a negotiated fee. The Council could also go out to appoint via tender process for the best price. However the Council would need assurances to be satisfied that the auditor would carry out the work within the set guidance and rules. There had been fairly detailed guidance issued for the procurement process.
• The grant fee was prescribed through the PSAA.

The Annual Audit and Certification Fees 2017/18 letter had been sent to the Chief Executive in April 2017. This was the final year under contract and the work didn’t differ from the current year.

Next year the deadline for the Financial Statement would be 31 July 2018.  Bracknell Forest had set the same deadline of 31 July 2017 for this year’s Financial Statements, which was challenging.

The total Audit fee for  2017/18 remained the same as the past two years. The Housing Benefit fee was still to be confirmed as it was dependent on the amount of work involved.  It was thought that the fee would be the same as 2016/17 although it was likely that there would be a reduction in the Housing Benefit fee of 20% as the Council’s Housing Benefit team were undertaking the initial testing work. An update would be provided to the Committee later in the year.

As a result of the Members’ questions and comments the following points were made:

• The PSAA were the fee setting body and regulatory body for 2017/18, this had previously been the role of the Audit Commission.

RESOLVED that the Committee receives an update from the External Auditor on work undertaken and notes the Audit fee 2017/18.