| AU.933 | The draft Annual Audit and Inspection Letter for 2005 was submitted which summarised the conclusions and significant issues arising from the Audit Commission’s recent Audit and Inspection Programme.
The Audit Commission was represented at the meeting by James Foster, Clive Portman, Linda Kettles and Karen Claber. Representatives from KPMG were also present.
The following issues were highlighted:-
- Council Performance and Direction of Travel
The Council was improving well and was now rated as a two star Council under the CPA methodology. The Council continued to deliver improvements in front line services for local people and maintained good performance in services for young people including school attainment and attendance levels. Further improvements had been made in recycling, the quality of parks, adult social care and the development of cleaner, greener, safer initiatives. 61% of the indicators of Performance had improved since 2002/2003, although challenges remained in reducing school exclusions. The rating in respect of ‘Use of Resources’ would have to be addressed, although the Value for Money score was very positive.
- The Accounts
The Audit Commission had been unable to reach an opinion on the Council’s 2004/2005 accounts by the planned opinion date of 31 October 2005. However, recent working papers presented to the Audit Commission were being reviewed and it was anticipated that an unqualified opinion on the 2004/2005 accounts would be reached by the end of January 2006. The 2004/2005 financial statements were prepared on time, however, the issues arising this year indicated that there was significant scope for improvement to ensure the Authority prepares the 2005/2006 financial statements a month earlier than in 2004/2005.
- Financial Position
Pressures on the 2005/2006 budget position were accumulating. Uncommitted General Fund Reserves and the rebuilding of the minimum balance in 2005/2006 provided only limited scope for future budget support. The proposed financial settlement for 2006/2007 had not improved the Council’s budget pressures.
- Action needed by the Council
The Audit Commission recommends that the Council take the following action:-
- Focus attention to improve how the Council manages and oversees its financial resources
- Prepare financial statements fully reconciled to underlying records by the earlier due date of 30 June 2006
- Continue to support the Director of Finance and E-Government in monitoring of finances, while the available balances are largely committed.
- Continue to develop the medium term financial strategy and the links between budgets and service plans and update it to reflect the current position.
The need to improve performance on reconciling the accounts was acknowledged and an explanation was given on steps put in place to achieve this.
The Chief Executive and Director of Finance and E-Government gave a statement explaining the work that the Authority had been and were currently undertaking with regard to the issues raised in the Annual Audit and Inspection Letter and reference was made to the support and advice received from the Audit Commission.
Clive Portman and Linda Kettles reported that this would be their last involvement with Bury and thanked Officers and Members they had worked with.
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