Agenda item

Report of the External Auditor (enclosed).

The Committee received a report of the External Auditors on their audit findings for the authority for the year ending 31 May 2018 that highlighted key matters arising for the Council’s financial statements.

It was advised that they had not identified any amendments to the financial statements that resulted in an adjustment to the Council’s financial position. Members were informed that subject to outstanding queries being resolved, the Auditor intended to issue an unqualified opinion on the Financial Statements and Value for Money conclusion on 31 July 2018.

A significant risk regarding financial challenges over the next few years was identified however, the External Auditors advised that this was an issue for all local authorities and concluded that Chorley Council had appropriate arrangements in place relating to financial planning and management.

Following queries, the External Auditors advised that the significant difficulties faced regarding communication requirements as indicated in the report were due to difficulties in receiving the financial information in the correct format and in a secure way following GDPR. These initial difficulties delayed the start of their detailed testing, resulting in a later completion of testing than originally planned. External audit recognised that this was a learning process and advised that a new cloud system was being tested to ensure this did not reoccur. Members were assured that they would be ahead of schedule for completion before the statutory deadline by 31 July 2018 as well as meeting next year’s deadline.

Members also queried whether the extra resources could have been employed at an earlier stage in the process in order to meet the deadline sooner. The External Auditors noted the suggestion.

The group discussed the Market Walk Development. At the Council meeting the previous evening, Councillor Alan Cullens submitted a Notice of Motion requesting the following:

1. That the Council be provided with an up to date valuation of the current Market Walk.
2. That the Council are provided with forecasted projected income levels and property valuation for the existing Market Walk development based on 2020 and 2024.
3. That the Council are given similar projections and a comprehensive viability report before any decision to progress further with the development of phase 2 is considered.

The Deputy Leader, Councillor Peter Wilson, advised that the final accounts were due to be signed off by the external auditor at the Governance Committee the following day. The accounts included the valuation of Market Walk and the income generated to date. It was not possible to forecast projected incomed levels and property valuation beyond the estimated modelling. Councillor Alan Cullens withdrew the Notice of Motion to seek assurance from this Governance Committee.

Grant Thornton advised that they we’re unable to provide this information as it was not part of their remit. The Value for Money conclusions were provided from the level of evidence available and reassured the Committee that the authority had done as much as it could. It was agreed that the Valuation Report regarding the Market Walk Development, as undertaken by the Valuation Agency, could be made available to Councillors. Although difficult to forecast, the Council wanted to ensure that any rates would be reflected correctly and therefore the rates would be closely monitored and revalued annually.

The Committee were made aware of the audit fee for the year and were advised that this was due to reduce by an extra 23% next year.

RESOLVED – That the report be noted.