Agenda item
Certification of grants and returns 2011-12
This report summarises the results of work on the certification of the Council’s 2011/12 grant claims and returns.
Minutes:
The Committee received a report that summarised the results of work on the certification of the Council’s 2011/12 grant claims and returns. Mr Stephen Lucas, Senior Manager KPMG, in setting the background to the report clarified that the certification work, with the exception of the housing and council tax benefit scheme claim (‘the housing benefits claim’) was performed by the Audit Commission as the appointed auditor for 2011/12 and completed by 31 October 2012. He continued that work on the housing benefits claim was split between the initial testing phase which was performed by the Audit Commission and the completion and reporting phase, which was performed by KPMG.
Members learnt that five returns relating to 2011/12 with a total value of £490 million had been certified and that the Audit Commission had issued unqualified certificates for four grants and returns. KPMG issued a qualification letter in respect of the housing benefits claim. He added that with fewer errors identified and one qualified certificate, this represented improvements in the accuracy and completeness of information provided for audit in 2011/12. Mr Lucas continued that overall, the Council had good arrangements in place for preparing grants and returns and no significant system weaknesses or issues of non-compliance with grant scheme requirements were identified that required to be addressed.
Mr Lucas informed the Committee that the fee for completing the grant certification work for 2011/12 was under £70,000, representing a reduction in the original estimate of £82,000. He attributed the lower fee to fewer claims that required certification and effective responses to audit queries. He drew members’ attention to the recommendations given to each risk rating and what action management would need to take to address the risk.
Councillor Van Kalwala enquired as to whether KPMG had identified the sources of the risks and whether any robust system had been put in place to address the number of cases that may come through. Andre White responded that the increase in demand for services coupled with reduced funding and reserves was putting pressure on staff and in some cases controls and risks already in place were not being complied with. Simon Lane added that additional resources had been made available to the Assistant Director of Customer Services who was fully conversant with the risks and was developing robust systems to address them.
In reference to recent publications by the Audit Commission on “improving council’s decision making on reserves, the Committee noted that whilst reserves helped councils to cope with unpredictable financial pressures and plan for their future spending commitments, a greater clarity was required from councils about the reasons for and the levels of the reserves. With that in mind it was agreed that this would be raised with members of the Budget and Finance Overview and Scrutiny Committee for their consideration. The Committee also emphasised the need for the Assistant Director of Customer Services to maintain a good grip on the risks identified.
RESOLVED:
(i) that the external auditor’s report on certification of grants and returns 2011-12 be noted;
(ii) that officers raise with members of the Budget and Finance Overview and Scrutiny Committee, greater clarity about the reasons for and the levels of the Council’s reserves.
Supporting documents: