To consider the report of the Interim Section 151 Officer, (copy enclosed)
The Committee considered the report of the Interim Section 151 Officer together with appendices 1 and 2 that detailed actions taken in response to the findings of the external auditor arising from the audit of 2018/19 accounts.
The Chairman introduced the report noting how comprehensive it was. In response to questions raised officers reported the following:-
- That Ignite highlighted the risk of losing staff in the transformation
programme blueprint. From their experience with other like organisations they forecast a straight line in terms of departures, however, this Council experienced a curved line as some staff left due to the transformation and some for other reasons. This resulted in a more rapid reduction than anticipated.
- That senior management direction was impacted by a number of issues as
outlined in the report. Given that the same senior officer was responsible for both the local elections, as Returning Officer, and the production of the Statement of Accounts, as Director of Resources, had a major impact on delivery of the accounts. This was further compounded by the departure of said member of staff as detailed in the report. In order to prevent a re-occurrence, the Council would ensure the Director of Resources post is supported by an experienced deputy Section 151 Officer. In addition, since September 2019, the Director of Resources role had been separated from the Returning Officer role which would also preclude the same situation re-occurring. The Returning Officer role was now under the remit of the Director of Strategy, Performance and Governance.
- That all actions identified in the report were already in hand and being
actioned by the Tier 2 Managers in liaison with Finance Specialists. All roles, responsibilities and timescales were clearly delineated in the timetable at appendix 2 to ensure the process remained on track for the production of a set of accounts by 31 May 2020. Any deviation from this would be covered by decisive urgent action on the part of the Director of Resources to bring it back on track.
- That the content of both appendices made it clear to officers the focus must be
on production of working papers in advance, thereby precluding auditors the opportunity of adding more time to their charges. However, it was also noted that the working papers this time round were the same as previous years, but the auditors were new to the process. This would always be an issue as the Council cannot legislate for who the auditors appoint in their respective team (s).
- That knowledge and experience had been built back up within the finance
team. In respect of treasury management, staff were following the operational guidance agreed by Council in February 2019 whereby qualified officers (a qualified accountant), would identify where an investment deposit could be made, with the final decision taken by the Section 151 Officer. The appropriate processes were now in place and the clean audit opinion corroborated that. It may now be timely to look at the financial accounting system in use. It was noted that SAGE 200 reporting was onerous in that information had to be downloaded into excel for reporting purposes. A system with inbuilt reporting tools that allowed reports provided directly from the system, cutting out the unwieldy excel process, would be more efficient, particularly now the Council was operating with leaner teams.
- Finally, it was noted that since the abolition of the audit commission the
Council, along with councils nationally, opted into the Public Sector Audit Appointments Ltd company to appoint their own auditors on a three yearly cycle. By opting in it saved the council expensive procurement costs on a three year cycle.
The Chairman thanked the Interim Section 151 Officer for the report and input from Members. She then put the recommendation to the committee and it was agreed.
RESOLVED that the Committee considered and noted the reasons for the issues identified by the external auditor in the 2018/19 audit of accounts, actions taken by the Interim Section 151 Officer as set out in section 3 of the report and appendix 1 and appendix 2 and the risks as identified in paragraph 3.5.