Agenda item

To review and note the EY External Audit Results Report for 2020/21.

The EA introduced the report and informed Members that whilst a results report was the intention, it was in some respects a progress report as the accounts were yet to be agreed. He added that whilst the audit had been planned to conclude in time for the agenda, fifteen outstanding questions remained across the areas outlined on p24, relating to several key risk areas. It was noted that completed audits included infrastructure assets and pension liability, and it was hoped that remaining audits could be completed in advance of the Christmas break. The EA reported that the delays had required additional audit resource and as a result, this would have an impact on the delivery of other audits if not completed prior to the year end. He added that despite this there were no uncorrected audit differences, following the correction of three identified, which included the misclassification of land around the Sheringham Splash site, a reduction in pension fund liability, and increases in bad debt provision. On value for money, it was noted that no significant weaknesses had been found, though the position would continue to be reviewed until the audit opinion was delivered.

Questions and Discussion

       i.          Cllr S Penfold asked whether there would be any issues if the 2020/21 audit could not be completed within the calendar year. The EA replied that EY’s order book was full until August, so either a future audit would have to be deferred to clear the backlog, or the conclusion of the audit would have to wait until after August. Cllr S Penfold asked whether the EA was confident that the audit could be completed within the short timeframe remaining, to which the EA replied that this would be a question for the DFR, given that fifteen questions remained outstanding. The DFR confirmed that she would have the audit completed by the end of the calendar year, unless there were any further significant findings.

      ii.          Cllr C Cushing noted that most of the audit delay appeared to be on the NNDC side, and asked whether the Council would incur costs as a result of the delay, then asked the DFR what assurances could be given that the same delays would not reoccur. The EA replied that one hundred percent of the allocated audit time had now been used, though it was only eighty percent complete, meaning that there would be at least a twenty percent overrun to achieve completion. He added that he would not be able to give an accurate figure for completion, but it was expected to be approximately twenty percent of the final fee stated in the report. Cllr E Seward stated that the Council was not in an ideal position to incur further costs, but it was important that the audit be completed. The DFR stated that the Finance Team were down on the number of permanent staff which had impacted audit work, but interviews had been held for an interim position to increase the available resource. She added that she took responsibility for completing the audit in advance of the year end and would endeavour to complete as many outstanding actions herself as possible, or otherwise delegate to the necessary officers.

     iii.          It was confirmed following a request from the Chairman that the outstanding audit work had been clearly identified within the report.

REOLVED

To review and note the EY External Audit Results Report for 2020/21.