Agenda and minutes

To confirm and sign the minutes of 19 June 2018.

The Chairman felt it important to note that the members who had sent their apologies were absent because the meeting had been rescheduled from the original date.  Peter Carpenter explained the meeting was rescheduled to allow completion of the audit and to provide a full, rather than draft, set of accounts. 

The minutes of the meeting of 19 June 2018 were approved and signed. 

To consider the Audit Results Report (ISA260) from the Council's appointed independent external auditor - EY (Ernst and Young).

Members considered the Audit Results Report (ISA260) presented by Neil Harris from Ernst & Young (EY), the Council’s External Auditor.  Neil introduced the Committee to Amalia Valdez Herrera who is Flo Barrett’s Senior Auditor, both of whom were instrumental in the audit.  He was pleased to report the external audit testing has now been concluded.  This is the first year of a new statutory timetable for accounts, with draft accounts needing to be prepared by 31 May and approval of the accounts by 31 July, putting increased pressure on all concerned.  The Council responded extremely well to the challenge and as a result Neil was pleased to confirm the Council’s financial statements represent a true and fair view of the Council’s finances as at 31 March 2018.  He concluded the Council has secured proper arrangements for economy, efficiency and effectiveness in the use of its resources, which is EY’s value for money conclusion.  The results reflect very well on the Council and its secure financial position.  

It was further noted that the Expenditure Funding Analysis, Whole of Government Accounts and IAS19 Procedures had been concluded since the time of the draft report.  However, there were two significant amendments made to the financial statements, one being an adjustment to the valuation of the Council’s leisure centres as all-weather pitches at two leisure centres had been erroneously included in the original valuation the Council obtained. The required changes have been reflected in the accounts for approval at this meeting.  The second adjustment made was to the Pension Liability valuation.  This is not specific to Fenland but happening across a number of county pension funds across the country.  EY are seeing a difference in fund valuation between the schedule of results included in the draft accounts and the valuation of the fund as included in the County Council Pension Fund accounts as at 31 March.   A rerun of the IAS19 was requested which had been responded to very quickly in order to provide an updated estimate at 31 March.   In conclusion there were no significant findings or deficiencies in terms of control.  Neil suggested that more information could be provided on analytics at a future committee as EY are investing heavily in technology to drive more efficient and effective audit.

Members asked questions, made comments and received responses as follows:

·         Councillor Booth asked if there would be any impact on the leisure centres tender process in respect of the revaluation. Mark Saunders advised that the tender process was about management and not the value of the asset. 

·         Councillor Sutton expressed concern that the pension deficit is now £66m having been told a year ago there was a deficit of £36m.  Peter Carpenter explained they are the most regulated audited part of the accounts, with actuaries taking about seven years to be trained and accredited; also looking at the adjustments, counties and districts will be more in line next year so this will not happen.  In terms of the valuation of a pension fund, there  ...  view the full minutes text for item CGC/13/18

The purpose of this report is for members to review and approve the final Statement of Accounts for 2017/18.

Members considered the Statement of Accounts for 2017/18 presented by Peter Carpenter. 

As an attachment to the accounts, an update had also been circulated by Mark Saunders showing the differences between the draft and final versions of the accounts.  Peter Carpenter stated that it was important to note that there was no difference in terms of the level of the General Fund and what was reported at year end. 

Members asked questions, made comments and received responses as follows: 

·         At the request of Councillor Clark, Mark Saunders went through the attachment, advising that the items were mostly technical accounting issues which had no impact on the Council’s use of reserves.  Councillor Sutton thanked Mark for the update and said it was very useful.  

·         Councillor Sutton commented that that there were some issues with the narrative report, namely under the heading ‘A growing population’ he said it was not strictly correct as the Local Plan and Economic Development Strategy, had not been decided yet.  Councillor Booth advised that there is an economic development strategy but it needs to be updated, and that is why it is going back to Overview & Scrutiny.  Councillor Sutton suggested therefore that this be reworded.  He also stated that under Governance, the number of councillors representing each political party was incorrect and thus the map and, although this did not affect the overall figures, nevertheless he felt it was important to point these out. 

·         Councillor Sutton asked for the current position with the figure of £0.693m under Provisions and Contingencies.  Mark Saunders advised there needs to be further analysis of business rates but has not got an up to date figure. 

·         Councillor Sutton stated he was surprised to see a lower figure for Garden Waste receipts in advance as he believed there had been a bigger uptake this year than last year.  Mark Saunders advised that the figure did not reflect any income received since 31^st March.  There would have to be a look at how many subscribers had carried on from last year, bearing in mind many people leave it until the last minute.  Councillor Booth agreed with Councillor Sutton’s point that they were led to believe that more people had taken up an earlier subscription this year compared to last year.  Consequently, Councillor Clark requested an update on those figures. 

·         Councillor Sutton asked if the remuneration to the Returning Officer and the elections team is reflected in the figures or covered separately.  Mark Saunders advised that this is a separate figure and not a direct cost to this Council unless they involve district elections.  Carol Pilson confirmed that the work done for all other elections are at no cost to us, the work is recharged to, say, the parish council or central government in the case of a parliamentary election and the figures are audited by the Electoral Claims Unit.  Mark Saunders confirmed that the accounts show the gross cost of the elections and include any money recovered via recharges. 

·         Councillor Butcher asked how  ...  view the full minutes text for item CGC/14/18

To agree the format and content of the Letter of Representation provided to the independent external auditor (EY) at the conclusion of the audit of the 2017/18 Statement of Accounts.

Members considered the Letter of Representation presented by Peter Carpenter who assured he is content that we have discharged our responsibilities for monitoring and reviewing the delivery of income and expenditure in the right way throughout the financial year. 

The Corporate Governance Committee agreed to approve the format and content of the Letter of Representation provided to the independent external auditor (EY) at the conclusion of the audit of the 2017/18 Statement of Accounts.  The Letter of Representation was duly signed. 

Although there were no items of topical interest, a few extra comments and suggestions were made at this point. 

·         Councillor Sutton mentioned that at the last committee he had suggested it may be beneficial to have a session with a pension actuary to help further understand the Council’s pension deficit.  Peter Carpenter agreed that this would be relevant, as they will also be able to discuss trends and fluctuations.  Councillor Clark asked that this be arranged. 

·         Councillor Booth asked what progress had been made since Councillor Sutton requested at the last meeting for consideration to be given to combining both the Corporate Governance and Conduct Committees.   Carol Pilson stated that this Council has constituted two committees with separate terms of reference; it would be a member decision to decide to change arrangements.  Carol suggested that Councillor Clark could discuss the matter with Councillor Hoy in the first instance as the chairmen of the two committees.  Councillor Sutton advised some authorities do have a sub-committee as governance is all about conduct.  There is also a potential saving regarding members allowances.   Councillor Booth felt that this should be a decision of the members as both chairmen could have opposing views which would lead to an impasse.  Councillor Clark advised that he would go away and consider this. Councillor Newell stated that she felt conduct and audit were different and just because it works in other places does not mean to say it would work here. 

·         Councillor Clark concluded by thanking everyone on behalf of the Committee for their help, he reiterated that we have confidence in the EY team, and he also thanked Mark’s team for their guidance.