To consider the external auditor’s findings 2022/23. 

22.1          Attention was drawn to the external auditor’s audit findings for 2022/23, attached at Pages No. 17-50.  Members were asked to consider the report.

22.2          The representative from Grant Thornton advised that the report summarised the findings from the audit of the Council’s financial statements and provided an update in relation to the work on the value for money assessment which Grant Thornton undertook for the Council. In terms of the accounts, at the time the report had been issued, it had been identified that ongoing work was required to close off the audit; however, further progress had been made since that time and all aspects had now been completed; some of the financial instruments were still being closed off but this was not something which would usually come to Members in relation to approval of the accounts.  Subject to the final approval of the accounts by the Committee, Grant Thornton would be in a position to issue its audit opinion in line with the statutory deadline of 30 September - this should be put on record as a significant achievement given that only 12% of local government bodies had received audit opinions in time to publish their annual accounts by the extended deadline in 2022.  Although a small number of amendments had been identified, as set out in the appendices to the report, it was intended to issue an unqualified audit opinion which was a good clean bill of health for the authority.

22.3          A Member raised concern that a number of local authorities, such as Slough Borough Council, were issuing Section 114 Notices and she asked whether the Councillors and Grant Thornton, as external auditor, had been aware of the issues at that authority and for how long.  In response, the representative from Grant Thornton advised that it was Grant Thornton’s first year of auditing that authority and specific issues had been identified so it was proposed to issue a qualified opinion on the set out accounts due to poor working papers, auditing practices and records.  The importance of getting the basics right should not be underestimated – if solid records could not be produced, it would be difficult for an authority to manage itself in a sensible way – and the Section 114 Notice was the final output from serious significant governance findings which Grant Thornton had identified through the course of its work for that authority.  It was effectively the responsibility of local audit to review the controls and call out poor practices.  The Member felt this reinforced how lucky Tewkesbury Borough Council was in terms of its Officers who were very good at their jobs.  Another Member asked whether the previous auditors at that authority had identified issues and the representative from Grant Thornton indicated that the reports had suggested that issues had been flagged, albeit not to the extent uncovered by Grant Thornton. A number of statutory and financial officers had been brought in to oversee the authority and the change in term of a new team and new external auditors had shone a light on a lot of things.

22.4          A Member noted that Page No. 44 of the report stated that, with regard to the 2021/22 audit findings report, errors had been identified during the audit process requiring significant adjustments to accounts disclosures which were the result of double-counting of balances and unclear documentary trails within the Council’s working papers.  She noted that this recommendation had been closed and she asked why it had not come up in previous years.  The representative from Grant Thornton clarified this was a specific issue for the year 2021/22 which had been thoroughly followed-up this year and there was no recurrence of what had happened in the previous year.

22.5          It was

RESOLVED           That the external auditor’s audit findings be NOTED.