Agenda item

Update from external auditors, Deloitte.

Ola Owolabi, Deputy Chief Finance Officer (DCFO) introduced the report and invited comment from Deloitte’s representative, Ben Sherriff. Mr. Sherriff provided a brief summary of the draft ISA160 report, which had been submitted as a late supplement to the agenda and circulated via email to Committee Members ahead of the meeting.

The DCFO noted that, as the audit opinion was now 90% complete, the recommendation was to delegate final approval to the Chair in consultation with the Section 151 Officer the Chief Finance Officer, to help ensure the rapid conclusion of the audit.

The Committee considered the report. Key points and comments that arose from the discussion included:

·       That due to the late submission of Deloitte’s report, there had not been adequate time to consider a document of its size and complexity.

·       Deloitte representatives confirmed that they did not expect any issues to emerge from the testing still in progress, (detailed in Appendix A, page 9), and that Deloitte’s own specialists were progressing the outstanding work on the ICE transaction.

·       Regarding clarification of the role of the Committee to satisfy the conclusion of the specific risk areas, as mentioned in Appendix A, page 5 of the report, Deloitte representatives apologised for an error in the report and confirmed there was no action outstanding for the Committee on this matter.

·       Regarding possible concerns around the valuation process noted on page 7, Deloitte representatives confirmed that this was not an uncommon finding or cause for concern and clarified that the expectations were partly due to the auditing professions own regulations.

·       Deloitte representatives and Officers clarified the difference between infrastructure assets and housing, and also provided a detailed explanation of the term ‘componentised approach to infrastructure assets’.

The DCFO provided further explanation for the recommendations in the report, noting that it was not unusual, when an audit neared completion as was currently the case, to delegate power to sign off the audit to the Chair in consultation with the Section 151 Officer and would avoid delays to final completion the External Audit for 2019/20.

The Committee considered and voted on the recommendations in the report:

·       To accept the Independent Auditor’s (Deloitte) report to those charged with governance on EBC Accounts, and the Value for Money conclusion report

·       To delegate authority to the Chair in consultation with the Chief Finance Officer to sign-off the audited EBC 2019/20 Statement of Accounts.

·       To authorise the Chief Finance Officer to sign the formal Letter of Representation to Deloitte.

The Committee voted against these recommendations by 0 votes to 4 with 2 abstentions.

A proposal was put forward instead for the Deputy Chief Finance Officer to liaise weekly with Deloitte advise the Chair when the accounts had been completed and could be brought back to the Committee. This was put to a vote and agreed.

RESOLVED (unanimously)

That the Deputy Chief Finance Officer liaise weekly with Deloitte and advise the Chair when the Statement of Accounts had been completed and was ready to be considered by the Committee as a whole.