Agenda item

To follow

The Chief Accountant highlighted key updates from the report and advised that the Council is on track to meet the deadline for the draft accounts to be published.

Members raised concerns about delays in producing the underlying data from the Revenues and Benefits system. The officer explained that several year-end processes must be run on 1 April to generate the data position as at 31 March, retain it in the system for audit, and produce the reports used for the collection funds. When the reports were reviewed, officers identified imbalances and subsequently established that a system patch was required, which took some time to complete. The Revenues and Benefits team also received incorrect guidance on rerunning the year-end processes, which had to be repeated after the patch had been applied and the revised reports reviewed. The officer confirmed that Finance officers should have identified the reporting issues sooner, and the Chief Accountant would take forward a different approach for the following year. Members asked who oversaw the system supplier. Officers could not confirm this at the meeting but indicated that it was likely to fall within the Director of Finance’s area of responsibility. Members requested that Audit Committee members be notified by email if the 30 June deadline for publishing the draft Statement of Accounts 2025/26 was not expected to be met. Members also discussed whether an online meeting should be arranged in September with the Director of Finance to review the points raised, given that the next Audit Committee meeting was five months away, and agreed that a September meeting would be useful.

Members asked for clarification on the figures in the Comprehensive Income and Expenditure Statement. In response, the officer referred to the recent online training on the Statement of Accounts, which had been recorded and was available in MS Teams, and which covered the topic with examples. The officer explained that the Comprehensive Income and Expenditure Statement presented the accounting view of the year’s activity, complied with accounting standards, and was required to be produced by the Council in a prescribed statutory format. The officer also explained the Expenditure and Funding Analysis, which showed income and expenditure according to the Comprehensive Income and Expenditure Statement, adjustments between the funding and accounting bases, and the amount chargeable to the General Fund. The officer further explained that the significant differences between the 2024, 2025 and 2026 current assets figures in the appendix balance sheet were due to incomplete collection fund entries, and confirmed that these would not appear in the final Statement of Accounts.

Members noted the low attendance at the recent online training and asked whether future training dates should be confirmed with all Committee members in advance to maximise attendance. Members agreed that it would be helpful to discuss future training dates and confirm availability at Committee meetings, as they had not been aware of the dates. The Committee Officer noted that training dates were listed in the Audit Committee work programme and published with the agenda. She confirmed that she could circulate the link to the recorded training session and consider alternative dates if the current dates were unsuitable. The Interim Head of Finance and Chief Accountant confirmed that training would be accommodated as required.

Members asked about the next review of the arrears shown on page 67 of the appendix, who was responsible for sense-checking Members’ expenses claims, and the reason for the significant increase in the figure. The officer advised that the narrative on arrears had not been updated and explained that officers reviewed the bad debt provision annually. Officers also explained that expenses claims were reviewed and verified by the Finance Business Partner and held in the finance system, but they were unable to provide details on the types of expenses or the reason for the increase. Members raised concerns about the audit fee figures. Officers advised that they would review the detail and provide a response. They explained that prior-year costs included finalising the payment to the previous external auditor, EY, the completion of value for money reports, and fee variations submitted to and determined by Public Sector Audit Appointments. The figures also included fee variations for work completed by Azets in relation to additional work arising from the income strip and build-back, which was not covered by the scale fee. Action – The Chief Accountant to confirm the detail to Committee members. Members noted that the exit package figures were identical to the previous year’s figures and asked whether this was correct. The officer advised that, due to the pressure to complete the draft Statement of Accounts before the deadline, there had not been sufficient time to update the document fully, and the duplicated figures were likely to have resulted from copying and pasting. Members requested to be notified when the figures were updated, and the published draft Statement of Accounts would be circulated to Committee members. Action – Finance officers.

Members asked about the Financing and Investment Income and Expenditure figures in the appendix. The officer explained that this figure reflected a large downward revaluation of investment properties in 2024/25, most of which was reversed from the General Fund, meaning that the net charge remained a net income to the General Fund. There were not yet any entries for valuation movements in the 2025/26 figures. Officers would notify Members when the figures were available. Action – Finance officers. The Chief Accountant advised that officers were considering bringing a proposed change to the ongoing work plan to a future Committee meeting. Under the proposed change, the draft Statement of Accounts would be approved by the Director of Finance and then brought to the first Committee meeting after approval, enabling Members to review the approved statement. The officer clarified that there was no requirement for the Audit Committee to approve the draft accounts before approval by the Section 151 Officer, and that it made more sense for the Committee to have oversight of the final Statement of Accounts and provide input as part of the audit process. Members agreed that a Committee meeting in September would not be required provided officers responded to the points and questions raised. The proposed September meeting would therefore focus on training only.

The Committee noted the draft statement of accounts.

RESOLVED:

That:

• The committee notes the update on the Draft Statement of Accounts 2025/26.
• The committee notes that the Draft Statement of Accounts 2025/26 will be approved by the Director of Finance and will be published in line with the statutory requirement.