Agenda item

A report from the Council’s External Auditor’s Mazars is attached

Karen Murray presented the Auditor’s Annual Report for year ended March 2021.

It was explained that the report reflected the VFM style now required  and was more detailed and balanced.

The Auditor’s Annual Report (AAR) summarised the work Mazars had undertaken as the auditor for Bury Council (‘the Council’) for the year ended 31 March 2021. Although this report is addressed to the Council, it is designed to be read by a wider audience including members of the public and other external stakeholders.

Mazars responsibilities are defined by the Local Audit and Accountability Act 2014 and the Code of Audit Practice (‘the Code’) issued by the National Audit Office (‘the NAO’). The remaining sections of the AAR outlined how they have discharged these responsibilities and the findings from their work.

Karen highlighted two areas:

1.   Ofsted Inspection: Children’s Services

In December 2021 Ofsted issued a report following its inspection carried out between 25 October and 5 November 2021 on the Council’s Children’s Social Care Services. The inspection report concluded that the overall effectiveness of the Council’s services is inadequate. These matters indicate a risk of significant weaknesses in proper arrangements.

The report recommended that the Council puts in place robust arrangements to ensure the actions identified in its improvement plan are being delivered on time and are having the required impact on quality of service provided to, and the safety of, children in the Borough.

Also set out were the External Auditor’s views on the actions taken to date and included work to identify improvements actions which weas underway before the inspection, the preparation of an improvement plan, ensuring that robust governance arrangements are in place including an independently chaired Improvement Board and investment in the recruitment of extra staff in order to reduce caseloads and address capacity.

2.   Weaknesses in Internal Control

The 2020/2021 Audit Completion report highlighted several issues including the poor quality of the draft accounts submitted for audit and the significant difficulties encountered during the audit process. Internal control weaknesses had also been highlighted by both Internal Audit and the Information Commissioners Office  resulting in several limited assurance internal audit reports and an ICO investigation report with 79 recommendations.

The report recommended that the Council should ensure it has arrangements in place for strengthening and maintaining the adequacy and effectiveness of the internal control framework.

Also set out in the report were the External Auditor’s views on the actions taken to date and included the appointment of a new substantive Deputy Director of Finance and an experienced Chief Accountant  which has strengthened the capacity within the finance team, the completion of a ‘lessons learnt’ exercise and a report outlining how the issues identified will be addressed and although some parts of the recommendations from the ICO report were still to be fully implemented,  significant progress has made in addressing the matters raised.

Also set out within the report were the other reporting responsibilities and a breakdown of fees for work completed as the Council’s auditor.

Members of the Committee were given the opportunity to ask questions and make comments and the following points were raised:

·         Councillor Gartside referred to the DSG and the issue with some schools holding onto reserves and asked what could be done about this.

It was explained that the Project Safety Valve had requested that school balances be brought down and all school balances would be reviewed to ensure that this happened.

Sam also reported that the Overview & Scrutiny Sub Group had taken a n interest in Project Safety Valve and would be receiving regular reports and updates on this.

·         Councillor Rydeheard referred to the governance weaknesses that had been highlighted and the reference to significant progress being made and asked if this work was set out within the action plan.

Sam reported that this was progress made in relation to the action plan and that the work was on track.

Delegated decision:

1.  That the contents of the External Audit Annual Report be accepted.

2.  That the Audit Committee’s thanks to Mazars be recorded.

</AI8>

<AI9>