Agenda item

Report from Bury’s External Auditors is attached

Karen Murray, Partner at Forvis Mazars, the Council’s External Auditors, presented a report  updating the Audit Committee on the 2023/24 fees, progress made in relation to the 2024/2025 Financial Statements Audit and the 2024/25 Value for Money work.

It was explained that Public Sector Audit Appointments Limited (‘PSAA’) have the duty to specify scales of fees as the appointing person, following consultation with key stakeholders. Following the backstop deadlines of 13 December 2024 and 28 February 2025, a large proportion of local authorities received a disclaimer of opinion in their audit reports, including Bury Council. Consultations have taken place for local authorities who received a disclaimed of opinion and now PSAA have confirmed the revised audit fees for these audits. This includes the original 2023/24 fee, the revised 2023/24 fee, and the 2024/25 fee.

The fees were set out within the report for years ending 31 March 2022, 31 March 2023, 31 March 2024 and the proposed fees for the year ending 31 March 2025.

In relation to the 2024/2025 Financial Statements Audit it was explained that in their previous progress report, Forvis Mazars had reported that Government had issued its response to the consultation on local audit reform. Following this, they were expecting to receive further guidance in July 2025 from the National Audit Office (NAO) to support the rebuilding of assurance. They have received the guidance they require to make their assessment on how to rebuild assurance for Bury Council. This follows the Council’s disclaimed audit reports for the three years ending 31 March 2022, 31 March 2023 (in December 2024) and 31 March 2024 (in February 2025).

It was concluded that they cannot begin the work to rebuild assurance as part of their audit for the year ending 31 March 2025 as there would be too much work to complete, therefore the intention will be to disclaim the 24/25 Financial Statements Audit.

This reflects two main issues. Firstly, the Council’s financial statements for the year were not prepared and published in line with the statutory deadline of 30 June 2025 and were still not published at 30 September. Secondly, the Council’s control environment operating across the period from 2022 to date was poor. This significantly impacts the work required to rebuild assurance and Forvis Mazars do not consider this feasible by the end of February 2026.

With regards to the Value for Money work, it was reported that the external auditors plan to undertake specific work to assess the actions the Council has taken to address the weaknesses previously reported. The report set out the weaknesses and the work that the external auditors expect to undertake in response.

The report also included links to relevant national publications that the Audit Committee may find useful.

Those present were given the opportunity to ask questions and make comments and the following points were raised:

·         Councillor Gartside referred to the Audit Certificate for 2023/24 and asked why this had not been issued.

Karen Murray explained that the National Audit Office had not yet confirmed whether they needed any more information in relation to this.

·         Councillor Gartside also asked how the Audit fees were being monitored.

It was explained that The S.151 Officer and Karen Murray have regular discussion in relation to the fees and the work required to rebuild. It was and they were also monitored by the Public Sector Audit Appointments(PSSA).

·         Councillor Moss stated that the audit fees had increased considerably in 2023/3034 and asked what the reason was for this.

It was explained that the PSSA had retendered the contract but other factors such as additional work required to meet a good audit, increase in financial pressures and fragility of the market.

·         Councillor Hayes referred to the risk of significant weakness arrangements in relation to Children’s Services and the fact that Ofsted had recently carried out another inspection which had recorded improvement and asked when this would be reflected.

Karen explained that the December report to the Committee would include progress made.

·         Mr Webster referred the 24/25 Financial Statements Audit the 2024/2025 being disclaimed and asked whether there was a plan or timetable in place in relation to the 25/26 accounts.

It was explained that there was no detailed plan as yet and discussions would be needed to look at options available. Bury Council were not the only council in this position.

It was agreed:

That the contents of the report be noted