Issue - meetings

To provide the Audit and Governance Committee with a summary of the proposals for addressing the Local Audit Backlog in England which has recently been published for consultation. Included as part of the report is the Council’s response to this consultation.

The report also includes a letter from Grant Thornton with their proposal for the delivery of the 2022/23 audit.

The Chief Financial Officer (CFO) presented a report, a copy of which had been circulated to each Member and a copy of which appears as Appendix 'A' to these Minutes in the Minute Book.

The Committee was reminded that the audit of the 2022/23 accounts had not yet commenced and the audit of the 2021/22 accounts had not yet concluded. As previously reported this was due to the continuing failure by the auditors of Dorset Pension Fund, Deloittes, to issue an IAS19 letter of assurance. The Council had submitted formal complaints on this matter to Public Sector Audit Appointments (PSAA) Limited and the Director of Deloittes. A further meeting was arranged with Deloittes which may also be attended by other local bodies affected by the delay.

The report set out the Government’s proposals for a three stage process to address the local audit backlog in England. These proposals had recently been published for consultation and a copy of the Council’s response was appended to the report. It was noted that a timescale of four weeks in which to provide meaningful feedback was insufficient, particularly for a large Council like BCP, and that a fundamental review of the accounting and auditing system was required. The report also included a copy of a letter from Grant Thornton with its proposal for the delivery of the 2022/23 audit.

Mr Peter Barber, representing Grant Thornton, reported that according to Deloittes they were one or two months away from issuing the IAS19 letter. He reassured members that subject to its receipt, he anticipated issuing an unqualified opinion on the 2021/22 accounts. He confirmed that the proposed backstop would not affect this, but it would have implications for the 2022/23 audit as it would not be possible to complete this by 30 September 2024 for the reasons provided in his letter. The application of the backstop would allow an early start on the 2023/24 audit with a view to signing off this set of accounts in a more timely manner. It was also noted that Grant Thornton was taking on the audits of Dorset Council and Pension Fund with effect from 2023/24.

The CFO and Mr Barber responded to questions and comments on the issues raised in the report. Members were advised that by the end of 2023 approximately 800 sets of accounts had been outstanding for around 500 public bodies in England. It was confirmed that Deloittes had cited resource challenges within its team including sickness as the reason for the delay in issuing an IAS19 letter. The procedure for appointing and changing auditors was explained. Mr Barber wished to make it clear that Grant Thornton did not intend to do any work on the 2022/23 audit for the reasons set out in its letter. He outlined the measures which would be taken to prepare for the 2023/24 audit. A Committee Member felt it would be helpful to know the key areas of risk from not undertaking further work on the 2022/23 audit.  ...  view the full minutes text for item 66