Report of the external auditor.

Purpose: the report summarises the results of the work on Oxford City Council’s 2013-14 claims and returns.

The Committee is asked to note the report.

The Committee considered the report of the Council’s external auditor summarising the results of work on Oxford City Council’s 2013-14 claims and returns.

Mick West introduced the report and explained the key points.

Tanya Bandekar and Nigel Kennedy explained the steps taken to address the points raised in the audit and to reduce the number and value of errors and said:

·         The Department of Works and Pensions recalculated subsidy payments based on the audit findings: these penalties were not within the council’s or the auditor’s control.

·         The Council had taken the opportunity of presenting additional cases for testing and had improved checks and documentation prior to the audit, which had reduced the overall error rate.

·         Benefit payments of £65 million were made, so the overall error rate was low in value and lower than many comparable authorities.

·         Managers were analysing causes of repeated errors; ensuring new staff were fully trained; and working with the auditors and the claimants to reduce errors.

The Committee requested more detail and background to the figures in the report, and comparisons with other local authorities.

The Committee noted the report and the assurance that the recommendations and action were completed.

Report of the external auditor: Annual Audit letter

Purpose: to set out the key issues arising from the work of the external auditors.

The Committee is asked to note the Annual Audit letter.

The Committee considered the annual audit letter from the Council’s external auditors. Alan Witty said that further information on the audit of the housing and council tax benefit subsidy claim would be supplied at the next meeting.

The Committee congratulated the finance team for achieving an unqualified audit.

The Committee noted the report, and asked that appropriate revenues and benefits staff attend the next meeting to discuss the audit findings.

Annual Result Report from External Auditors.

Ernst and Young as the council’s external auditors submitted their audit results report for the year ending 31^st March 2014.

Alan Witty and Mick West, from Ernst and Young, stated that they intended to issue an unqualified opinion on the accounts following conclusion of the audit. The audit had uncovered a number of misstatements subsequently corrected by officers although it was noted that these had no effect on the overall financial position of the council. They had also identified a further two misstatements which officers had not corrected.

In response to questions around the uncorrected misstatements within the accounts, Nigel Kennedy, Head of Finance, stated that the provision made in the accounts for business rates appeals was in his opinion sufficient and did not require any notes or additions to the accounts. In respect of an uncorrected presentational misstatement relating to pensions he advised that he saw no merit in further complicating the Statements for changes which made no overall difference to the council’s financial position. This position was further explained in the officer’s report (minute 20 refers) and the Letter of Representation to be signed by both the Head of Finance and the Chair of Audit and Governance.

The committee noted that resourcing issues which arose during the audit had delayed the audit, and that Nigel Kennedy had made representations to Ernst and Young who had apologised and given assurances that the situation would be improved next time.

The committee agreed:

1.    to note the report; and

2.    to note the comments from the external auditors and the Head of Finance.