To review and agree the external auditor’s audit plan for 2018/19.

The chief finance officer presented the report. 

The committee expressed concern that the accounts for 2016/17 and 2017/18 had still not been signed off.  

It was reported that the council do not have any leverage in connection with the confidential matter which was still outstanding as it did not relate to an existing staff member or a company which the council have a controlling interest in.  

The following points were raised in discussion with the issue: 

·         The matter had been ongoing for 3 years and there was no indication when this could reasonably be expected to change

·         There had been no sharing of information in a confidential session so the committee struggled to see how it could be reasonably allowed to continue.

·         It appeared that there were no elected representatives who were in possession of an understanding of the issue.   The chief finance officer confirmed that the issue was being held by the statutory officers of the council. 

·         Grant Thornton had issued an audit opinion for audit of the accounts and the value for money audits.  

·         The level of materiality could not be determined at this stage but Grant Thornton could not comment until the matter was progressed further.   Grant Thornton were being kept informed of progress.  It was noted that there were different levels of materiality  but it did not reach the £6m financial materiality level.

·         This was an historical event and not an ongoing issue but there could be ramifications arising from the event.

·         It was a complex issue which cut across a number of things and there were different routes which the issue could go down.  

·         This was a complex, sensitive issue and external legal advice had been sought.

·         The council were in the hands of third parties and there was another conversation with them on Thursday 24 January 2019.

·         It was concerning to note that this issue may go beyond the May 2019 elections. 

·         It would be inappropriate to identify the third parties as this would fuel speculation

It was agreed that: 

·         A letter would be sent to Grant Thornton and ask what action has been taken, what the options are and the timescales involved.  

·         A report would be presented to the March meeting setting out the progress of this issue.  

A discussion over whether the committee could be briefed on the issue in private session took place.   It was agreed that there would be no private session.

Grant Thornton presented the annual audit plan for the 2018/19 accounts.  

It was noted that the level of materiality may be different following discussions between Grant Thornton and the council.   There will be an update on what the materiality level will be at the March committee meeting. 

Following a query from a member of the committee, it was confirmed that the audit fee was a scale fee which was set by the PSAA. 

Following a question from a member of the committee, Grant Thornton confirmed that they would not look specifically at the development regeneration partnership (DRP) and  ...  view the full minutes text for item 350