Issue - meetings

To consider the report of the Corporate Director of Transformation, Housing & Resources.

Consideration as given to the report of the Head of Finance, Procurement & Commercial Services, as contained on pages 1095 to 1156 of the Book of Reports, which presented the 2020/21 Interim External Audit Findings Report from Grant Thornton referred to Council from the Audit & Governance Committee.

RESOLVED:   That the report be noted.

To consider the report of the Head of Finance, Procurement & Commercial Services.

Consideration was given to the External Interim Annual Auditor's Report (AAR) 2020/21 as contained on pages 353 to 386 of the Book of Reports, the purpose of which was to receive the Auditors Annual Report from our External Auditors Grant Thornton.

The Chairman welcomed and invited Georgia Jones, Director, Grant Thornton, to present the report to the Committee.

Two significant weaknesses were identified in the interim report, firstly, the Council does not have satisfactory arrangements in place to prepare timely financial statements that are free from material error. Secondly, the Council does not have satisfactory arrangements in place to ensure the role of Internal Audit has the required impact and effectiveness due to the change in responsibilities and reporting structure.

Comments were made by the Head of Finance, Procurement and Commercial Services as follows:

• Resources have been asked for to facilitate the centralisation of the Procurement Service
• Significant changes around re-setting the basic processes has progressed
• Recommendations from the report have been accepted and progressed

Questions from members included:

• Will Grant Thornton look at Tawd Valley Development's accounts, big projects and investments, or the decisions and information related to the transactions?
• Can examples be provided for the benefits of the centralisation of procurement?
• Is it being considered to look at working with other commercial services to utilise frameworks in place?
• Can it be established we've got value for money on transactions?
• Recommendations are to be followed through to ensure they are complied with

The Director of Grant Thornton confirmed that they will not be completing an audit on Tawd Valley Development's accounts, big projects and investments, or the decisions and information related to the transactions as this would be for their External auditor to do. They then would only look to ensure that the accounts have been prepared in accordance with accounting policy and are free from material error. Grant Thornton would only look at this if there was potentially something wrong. The purpose of Grant Thornton's audit would be to make sure the arrangements and processes are in place to ensure appropriate decisions are made within the Council. It would also look to ensure that the Group Accounts had been incorporated into the Council's Annual Accounts in a proper manner.

The Head of Finance, Procurement and Commercial Services confirmed that the electricity contact has been investigated, leading to significant savings as the contract in place would have cost a lot more. Standards are being enforced by management, and processes will be centralised to go through the central Procurement Team – resulting in consistency of practice and tighter control and governance around procurement processes.

The Procurement Manager confirmed that other frameworks in place from Crown Commercial Services are being considered, to utilise the frameworks and avoid carrying out work that has already been done elsewhere.

The Director of Grant Thornton confirmed that the audit is to help put the processes and arrangements in place so members can assess value for money themselves, this isn’t something the audit can assess.

RESOLVED: That the External Interim Annual Auditor's Report be noted.