Audit Committee - 25 September 2026

The Audit Committee began by approving the minutes of its previous meeting. In an update from Grant Thornton, the External Auditors, it was reported that the draft 2025/26 Statement of Accounts had been submitted by the statutory deadline and that audit work was on track for reporting to the November Committee, with no significant issues identified. The significant financial risk posed by the Dedicated Schools Grant (DSG) deficit was discussed, though government proposals to fund historic deficits could improve the position. Assurance was provided on property valuations and compliance with accounting standards. Regarding the Pension Fund, approximately 23% of assets were classified as Level 3 investments, with delays related to third-party fund managers rather than the Council. A query on the value for money implications of a specific property transfer was referred to officers and auditors for review outside the meeting. The Committee resolved to review the External Auditor’s Update.

An update on the 2026/27 Internal Audit Plan showed delivery was largely on target, with some audits removed where second-line assurance existed and new ones added for emerging risks. Staffing challenges were noted, with plans to recruit a graduate trainee and procure additional capacity. The Committee discussed a limited assurance opinion on contract management, where it was explained that contracts were generally managed appropriately but full compliance with the Council's toolkit was not always followed. The removal of the capital programme review was explained by ongoing management-led reprofiling work, potentially allowing a future audit once that progress continued. The Committee noted the high level of implementation of agreed management actions. It resolved to note the key performance indicators and recommended to Cabinet that further investment in the Internal Audit Team be considered as part of the budget development process.

The Committee subsequently reviewed the Counter Fraud Risk Assessment and Strategic Risk Register. Cyber security risks were acknowledged as a significant ongoing threat, though recovery plans were in place. Fraud risks related to Adult Social Care direct payments and procurement were discussed, with assurance given on existing monitoring and controls. Members suggested that future reports should show inherent and residual risk ratings for fraud risks to provide clearer visibility of control effectiveness, which officers agreed to consider. Financial sustainability pressures were noted as being reflected in the strategic risk framework, and discussion on the climate change risk requested further feedback on climate adaptation and resilience measures as well as carbon reduction. The Committee took assurance that strategic risk and fraud risk frameworks were in place and operating effectively.

Finally, the Chairman referred to the recently approved Commercial Strategy, noting its potential implications for the Committee’s future role regarding governance arrangements, oversight of the Council’s Group of Companies, and compliance with emerging audit standards. Officers agreed to provide a briefing on these implications in advance of the November meeting, when the Group of Companies' audit arrangements would be considered. The Chairman also stated he would discuss meeting attendance with Senior Officers.