Agenda item

The draft statement of accounts for 2022/23 was published within the statutory deadline on the 31^st May 2023. At that time the audit of the statement was expected to be completed later in 2023. However, due to the complex set of factors contributing to audit delays across the sector, an audit of the 2022/23 statements has not been completed, other than work relating to the external auditor’s value for money opinion. To address the national backlog of local audits the Government is imposing (subject to secondary legislation) a backstop date of 13 December 2024 for publication of accounts for financial years up to and including 2022/23. The Committee is required to consider and approve the accounts before they are published.

Peter Barber, representing Grant Thornton, the Council’s External Auditor, 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 required to consider and approve the draft statement of accounts for 2022/23 before they were published. Mr Barber summarised the key points detailed in his letter, dated 12 November 2024, regarding the conclusion of the audit for 2022/23. The letter included the reasons why it was not possible to complete the audit for 2022/23 by the statutory backstop date and the proposal to issue a disclaimer. It was noted that the Value for Money (VFM) work for 2022/23 previously reported to the Committee had been fully discharged and was recirculated at appendix 3.

In response to questions Mr Barber assured members that a full audit for 2023/24 had been undertaken and was on track to meet the February 2025 deadline. Regarding previous delays, he confirmed that Dorset Pension Fund was aware of the importance of issuing its letter of assurance to ensure the completion of the 2023/24 audit. It was aimed to get this letter before Christmas 2024. He clarified that the significant weaknesses listed in the draft audit report at appendix 2 had already been identified and reported to the Committee previously as part of the VFM work. In respect of the statement of accounts for 2022/23, the Assistant Chief Financial Officer wished to assure members that the Council’s usable reserves had not changed as a result of subsequent decisions taken by Cabinet and Council.

A concern was raised regarding the total estimated figure for the Transformation Investment Programme, as shown in the statement of accounts, and whether there were any tangible benefits from the public’s perception. The Chief Executive referred to the regular updates provided on the transformation programme. He advised that a completion report was due to be submitted to O&S and Cabinet in January 2025, which would include the levels of expenditure and savings over the programme’s lifespan.

The Committee was advised that the issues raised in the report related to the 2022/23 financial position and that the position for 2023/24 and the current year to date reflected the positive changes made, as reported at previous meetings. Members acknowledged the progress made in addressing the significant weaknesses identified in the report and it was recognised that the matters identified were known issues. For example, Members were well aware of the Dedicated Schools Grant. The forthcoming update on the transformation programme was noted and may be something for the committee to review in due course. There was now a need to look to the future. However, this did not mean that past issues, such as FuturePlaces, should be overlooked or that issues from the 2022/23 financial year should not be considered where there were lessons to be learnt, perhaps as part of wider look at decisions made at that time where there were costs involved and longer term implications.

The Committee considered a proposal to undertake an investigation into FuturePlaces. Members discussed the need to scope the investigation as widely as possible, invite member input into the scoping process and ensure all evidence requested was available. The Committee considered a suggested format for the investigation and felt that while the initial scoping/briefing may or may not be done informally, there needed to be a discussion in the public domain. The Chief Executive responded to a question about how much was already known in terms of lessons learnt, bearing in mind the amount of time and resources an investigation might require. He felt that the key lessons had been learnt. He referred to the internal and external reviews of corporate governance and company shareholder governance processes and the actions arising from the Best Value Notice which had all been complied with. There was some value in terms of councillor engagement and in public discussion.

The Committee requested that an investigation on FuturePlaces be added to the Forward Plan. Members could then discuss in more detail how to deal with the investigation as part of the Forward Plan agenda item at its next meeting.

RESOLVED that the Committee:

a)    Notes the ISA260 Audit Finding report letter sent to the Chair of Audit and Governance Committee (appendix 1);

b)    Notes the draft audit report for 2022/23 (appendix 2) which auditors will sign as soon as possible by the deadline of 13 December 2024;

c)    Notes the Value for Money report 2021/22 and 2022/23 previously presented to Audit and Governance on the 7 September (appendix 3);

d)    Approves the signing of the Statement of Responsibilities and the Letter of Representation by the Chair of the Audit & Governance Committee and the S151 Officer (appendix 4);

e)    Approves the 2022/23 statement of accounts 2022/23 (appendix 5).

Voting: For – 5, Against – 0, Abstain – 2

As a result of the discussion on Future Places, the Committee took a separate vote on the following resolution:

RESOLVED that an investigation on Future Places be added to the Committee’s Forward Plan

Voting: For – 5, Against – 1, Abstain – 1