Audit Committee - 14 November 2025

The Audit Committee began by electing Councillor Boase as Vice‑Chairman, a motion moved by Councillor German and seconded by Councillor Webb, with no declarations of interest. The Committee also approved the minutes of the 26 September 2025 Audit Committee meeting, a motion moved by Councillor Magowan and seconded by Councillor Yelland, and resolved that the minutes be signed by the Chairman. In accordance with the Local Government Act 1972, the press and public were excluded from part of the discussion because it involved exempt information relating to the financial or business affairs of individuals or the authority.

The Committee reviewed the Council’s ownership function for its entities, which operates under Article 21 and its supporting protocol. Annual owner reports for each entity, covering performance, governance and the year ending 31 March, were presented alongside audited financial statements that had been approved by the respective boards. Draft “best‑value” reports are being finalised for endorsement in December and will be published for transparency. A governance review has updated Article 21, and the revised provisions are scheduled for Full Council consideration. Ownership risks have been recorded on the Council’s Risk Register, and risk‑management processes are now embedded across the entities.

A series of presentations addressed operational and financial risks. The Chief Executive of Corserv reported on delivery against the 24/25 Business Plan and confirmed the three‑lines‑of‑defence model, the role of the Risk and Assurance Committee and the involvement of external assurance bodies such as the CAA, CQC and BSI. Strategic risks highlighted included airport subsidy requirements, contractor availability, recruitment challenges, an ageing workforce, economic slowdown and contract‑management weaknesses. The airport remains a major deficit driver, with a four‑year plan under development to address the subsidy. Cyber‑security controls, including Cyber Essentials accreditation, regular penetration testing and a business‑continuity plan, were affirmed as robust. Internal audit, supported by a specialist cyber‑security firm, continues to address IT risk, and the external auditor’s interim report identified asset‑valuation adjustments of about £30 million within a total asset base near £4 billion.

The Committee examined the External Auditor’s interim annual report and progress report for 2024/25, moved by Grant Thornton. Members discussed the overall financial picture, the Designated Schools Grant deficit of roughly 24 % of usable reserves, and the meaning of an unqualified audit opinion. Ombudsman complaints numbered 56, with an 88 % uplift rate. Recommendations for strengthening savings planning and contract‑management arrangements were noted, and a business case for contract‑management improvements is being prepared. The Committee also reviewed the Cornwall Pension Fund Audit Findings Report and requested any needed clarifications from the auditors. Finally, the Head of Commercial Assurance and the Strategic Sourcing Manager presented the Contract Procedure Rules and the level of exemptions granted in 2025/26; the Committee resolved to congratulate officers on their work on exemptions and emphasized the importance of maintaining robust procurement processes.