To review and agree the external auditors audit plan for 2017/18.

Grant Thornton presented the presented and highlighted the following:

·         The scope was public sector audits was broader than private sector audits and also covered value for money.

·         The risks to the audit were set out in pages 45 to 47 of the pack

·         The early close of the audit (from September to July) would be a significant challenge for both the council and Grant Thornton.

Following a query from a member of the committee, it was confirmed that whilst the checking of the pension liability should be straightforward, the methodology used by actuary would still need to be checked.   It was noted that the ability to drill down on the payroll accuracy may be more difficult. 

Following a question from a member of the committee, Grant Thornton confirmed that with regard to the accumulation of non material items, they use the concept of tolerable error.  This is used towards the end of the audit.   If there was any issue which was over the materiality threshold, then it would be referred to the committee for consideration and then Grant Thornton would make a decision as to whether or not to give an unqualified audit opinion.  It was agreed that Grant Thornton would provide a training session to the committee on materiality.  

The chief finance officer and Grant Thornton confirmed that there were ongoing conversations about how to treat the Hoople pension liability in relation to the Local Government Pension Scheme.   It was noted that this had the potential to be a material issue and if it does not appear on the council’s balance sheet, then it will not appear as a risk.    This issue will be kept under review by Grant Thornton. 

It was confirmed that Grant Thornton are the external auditor for Hoople.    The chief finance officer agreed to provide a briefing note on the work SWAP conduct in auditing the processes which Hoople carry out on behalf of the council, together with the system Hoople have in place for internal audit control. 

Following a query from a member of the committee, Grant Thornton confirmed that they do ask for assurance that the organisation is acting legally.