Agenda item

To receive a report from Grant Thornton (External Auditors) seeking comments on the Auditors Annual Report 2020/21.

(This report has been circulated as part of the republished agenda on 16 September 21)

Sophie Lewis (Grant Thornton – External Auditor) introduced a report which updated the Committee on the annual review undertaken of the Council’s Value for Money arrangements. 

In considering the report the Committee noted:

·                Under the National Audit Office (NAO) Code of Audit Practice (‘the Code’) the External Auditors were now required to consider whether the authority had put in place proper arrangements to secure economy, efficiency and effectiveness in its use of resources.  The auditor was no longer required to provide a qualified/unqualified VFM conclusion and instead was required to report on the Authority’s overall arrangements as well as key recommendations on any significant weaknesses in arrangements which had been identified. 

·                The specific criteria under the new arrangements on which the Auditors were expected to focus their assessment namely Financial Sustainability, Governance and improving Economy, Efficiency and Effectiveness.

·                The three categories of recommendations which could be raised by the Auditors as an outcome of the review process, as detailed within Appendix B of the report.  These included statutory recommendations (of which none were identified within the report); Key recommendations where significant weaknesses had been identified (of which none had been identified) and lastly improvements which were designed to improve the arrangements already in place and not as a result of any significant weaknesses being identified. Whilst a number of improvement recommendations had been identified, no statutory or key recommendations had been raised through the audit with members noting the commentary provided in relation to the arrangements for securing economy, efficiency and effectiveness in the use of the Council’s resources in relation to each of the three main criteria.

·                The improvement recommendations identified were intended to provide constructive criticism and advice and it was noted that productive and positive engagement with officers regarding the recommendations had taken place.

The following issues were raised in relation to the update provided and responses provided for review by the Committee:

·         Members welcomed the feedback from officers regarding the positive and constructive nature of the process and engagement with the Auditors with it recognised that Brent had been one of the first Authority’s nationally to have reached this stage under the new arrangements.

·         Members support to ensure that any best practice and benchmarking (especially involving social value considerations) identified as a result of the process and recommendations being made in relation to other Local Authorities as they completed the process was shared across the sector.

·         Further details were sought on the improvement recommendation raised in relation to making a clear distinction between statutory and discretionary spending in the budgetary information provided to members and on the website.  In response, members were advised the recommendation was about ensuring transparency in terms of distinguishing between where the Council had discretion over the use of resources and where there was a statutory requirement to do so.

·         Members welcomed the report, with it noted that the improvement recommendations identified (as they related to the remit of the Committee) would be included for ongoing monitoring and review as part of the Internal Audit and Committee work programme.

As no further issues were raised the Chair thanked officers and the External Auditors for their efforts and it was RESOLVED to note the contents of the Auditor’s Annual Report, which subject to being finalised would also need to be referred to Full Council for review and approval.