Agenda item

To consider the report of the External Auditor, Grant Thornton.

 (Please note this report is to Follow)

Jackson Murray, Engagement Lead, for the Council’s External Auditor, Grant Thornton presented the ISA 260 Audit Findings report, and referred to the Audit Risk Assessment of the financial statements for the financial year 2019/20 which had been circulated as a supporting document. The detail was presented as a PowerPoint presentation and included questions put to the Council’s management, as well as the response by Grant Thornton.  It was confirmed that the responses had not resulted in any additional significant audit risks.  The Director Finance responded to a Member who was disappointed that there had been a lack of time to view the Risk Assessment information and as it was technical in nature, was able to assist in its understanding. 

The Engagement Lead introduced the Audit Findings report in respect of the 2019/20 Financial Statements and the Value for Money conclusion. It was reported that the audit was substantially completed with only a small number of areas in progress, with the audit expected to be concluded by the deadline of 30 November.  Subject to the satisfactory finalisation of the audit testing, an unqualified audit opinion will be issued.

The following areas were highlighted:-

• the inclusion of an ‘emphasis of matter’ paragraph in relation to the potential for material valuation uncertainty in the sector as a result of Covid-19, and valuation of the Council’s land and buildings and investment properties;
• the completion of the risk based review on the Council’s value for money;
• that no additional statutory powers or duties were exercised;
• a number of disclosure and classification adjustments to the financial statements had been agreed, which had no impact on the overall financial position of the Council, and
• a prior period adjustment was made in respect of the NDR appeals provision following its reclassification from short-term creditors to provisions on the balance sheet.

The Engagement Lead advised that they would issue an unqualified value for money conclusion for 2019/20 on the Council’s value for money arrangements.

The Engagement Lead also gave the following response to a Member’s question and confirmed that the cyclical five year rolling programme related to the Council’s other assets, including Council dwellings within the Housing Revenue Account (HRA). A full valuation of the Council’s investment properties is performed annually in accordance with accounting standards. The valuation programme had been revised for 2019/20, with a requirement for a minimum 20% valued, as well as the top four highest valued assets from the previous year.  Any significant movement or concern of a wider market impact would lead to further assets being valued. The Director Finance clarified that commercial rent performance had been very positive, and the City Council continued to work with businesses in support of rent deferral plans wherever necessary.

In response to a Member’s question the Service Lead Legal Service, stated that once the matter was concluded, the detail of a Health and Safety Executive breach would be reported to Members.

The Audit and Governance Committee noted the report on Audit Findings from the Exeter City Council (External Auditor), Grant Thornton.

In accordance with Standing Order 43, two Members wished to abstain from noting the supporting document on the Audit Risk Assessment as they had not had sufficient time to review the information.