Agenda item

To note the Audit & Governance Committee Action Log.

At the request of the Committee Jane West, Section 151 Officer, provided a verbal update on the status of the 2019/20 accounts, which had been due to the February meeting. It was advised the 2019/20 accounts had been close to completion in December 2023, however there had been an issue which required incorporation and adjustments to be made and had caused the delay. The council was awaiting the external auditor’s final position on the issue and anticipated either an additional Audit and Governance Committee to be scheduled in February 2024 or the 14 March 2024 meeting would receive the final 2019/20 accounts at the latest.

The cost implications and frustration of the ongoing audit of the 2019/20 accounts were noted and the committee queried what support it could provide in resolving this. Councillor Cummings, Cabinet Member for Finance commented on the frustration around the issues which had arisen and caused further delays and reminded the committee it could hold to the external auditors to account.

The consultation regarding the government’s proposals to implement a backstop date for the auditing of local government accounts on 30 September 2024 was expected to open soon. These proposals would impact Croydon’s ability to complete its backlog of accounts. The 2022/23 accounts would not be completed in time and discussions were ongoing with the external auditors regarding the feasibility of completing the 2021/22 accounts if the backstop was implemented. Officers advised they were unsure how the opening balances for 2023/24 would be ascertained if the previous year’s accounts were not able to be completed. Croydon had written to the National Audit Office (NAO) noting the council’s challenging position and had requested dispensation to allow the auditing of all previous year’s accounts to be completed. The NAO had advised these comments were to be submitted when the consultation formally opened. Officers confirmed funds to cover the increased audit costs were held as a reserve. The public interest in the council’s full completion of the accounts was noted and it was the council’s intention to complete all years to have a full record. It was suggested that the Audit and Governance Committee may be able to support the council’s response to the NAO consultation.

In response to questions from the committee around the resources available to complete the accounts, officers advised the Finance Team had a dedicated team working on the financial statements and auditor queries. There was pressure on Grant Thornton’s resources however this was being discussed regularly and there was intent for the external auditors to retain the same team for Croydon.

The committee queried whether Croydon had engaged with the Department for Levelling up, Housing and Communities (DLUHC) on the backstop proposals. Officers advised they had, there were numerous government bodies involved in the national discussion including the Financial Reporting Council, CIPFA and the Local Government Association (LGA). Audit resources were a national issue, and all parties would need to agree to a way forward. Croydon was lobbying and in conversation with DLUHC regularly regarding its position on the backstop proposals.