Verbal update by Deloitte and Lewes District Council Officers
Minutes:
The Committee received a verbal update from the Deputy Chief Finance Officer (DCFO) and the Council’s External Auditor, Deloitte, in respect of the External Audit of the 2018/19 Statement of Accounts.
The DCFO reminded Members that previous updates were given regarding the External Audit of the 2018/19 Statement of Accounts at the November 2020 and January 2021 meetings of the Committee. Following the updates, the Council had been engaged with Deloitte in order to produce a list of outstanding issues in respect of the 2018/19 Statement of Accounts, as was requested by the Committee at its meeting in November 2020.
The DCFO highlighted that the outstanding issues were escalated to the Senior Director of Deloitte on 10 February 2021. A meeting took place between Mr Sheriff and the Senior Director of Deloitte, and the Council’s Chief Executive (CE), Chief Finance Officer (CFO) and DCFO. The CE made it clear that the Council’s Members were not happy and charged Deloitte with a deadline for the completion of the outstanding External Audit of the 2018/19 Statement of Accounts. The Council’s External Auditor reiterated that the continued delay was primarily due to a lack of resources including staffing, and the Covid-19 pandemic.
The DCFO further highlighted that, as a result of the meeting, it had been agreed that there would be a monthly meeting between the Council’s senior officers and Deloitte so as to continue monitoring the progress in respect of the closure of the 2018/19 Statement of Accounts.
Mr Sheriff confirmed the statements made by the DCFO. He explained that Deloitte was in the process of testing on a number of the outstanding items in respect of the closure of the 2018/19 Statement of Accounts at which point the Council’s External Auditor would be able to work through the outstanding issues and complete testing in the remaining areas.
Discussions included:
· Whether or not Deloitte would be able to provide an estimated completion date in respect of the External Audit of the Statement of Accounts 2018/19. Mr Sheriff explained that Deloittecurrently had a scheduling of staff for March through September 2021 to work on the outstanding audits for both Lewes District Council and Eastbourne Borough Council.
· Whether or not the fees had been paid to Deloitte for the External Audit of the Statement of Accounts 2018/19 and 2019/20. The DCFO responded that the 2018/19 agreed PSAA contractual fees had been paid, however, there may be a variation of fees which have yet to be determined. He confirmed that the fees for 2019/20 had not yet been paid.
· Whether the list of outstanding issues for the Statement of Accounts 2018/19 previously requested by the Committee had been made available to the Council’s Officers to be signed off. Mr Sheriff responded that although the list of outstanding items had been agreed, there were items on the list that still needed to be tested before they were signed off as completed.
The DCFO highlighted that during the ongoing discussions with Deloitte, Council Officers had requested a specific list of outstanding issues in order to formally sign off the items as completed, but Officers had not yet received the requested list from Deloitte.
· The Committee expressed its dissatisfaction with potential costs in relation to the External Audit of the Statement of Accounts 2018/19 and queried whether or not the Council would see potential additional costs for the External Audit of the Statement of Accounts 2019/20. The DCFO clarified that external audit plan which was presented for 2018/19 alluded that there might be potential variations to the contract, however, all variations needed to be agreed with the Public Sector Audit Appointments (PSAA). Mr Sheriff further clarified that the scale fee was not reached by negotiations, but was a figure that the PSAA implemented that did not take into account external implications.
· The Committee asked for the assurance of Mr Sheriff that the outstanding audits in respect of the Statement of Accounts 2018/19 and 2019/20 would be completed as soon as practicably possible and with sufficient resources. Mr Sheriff agreed.
The Chair thanked Mr Sheriff and the DCFO for their continued work in relation to the External Audits of the Statement of Accounts 2018/19 and 2019/20.
Resolved: That the verbal update be noted.