The Annual Audit Letter for Salford City Council City Council.pdftested revaluations made during the...

© 2016 Grant Thornton UK LLP | The Annual Audit Letter for Salford City Council | October 2016

The Annual Audit Letter

for Salford City Council

Year ended 31 March 2016

24 October 2016

Cover page

Mike Thomas

Director

T 0161 214 6368

E [email protected]

Tommy Rooney

Manager

T 0161 214 6359 E [email protected]

Daniel Watson

In Charge Auditor

T 0161 234 6344

E [email protected]

mailto:[email protected]

mailto:[email protected]

© 2016 Grant Thornton UK LLP | The Annual Audit Letter for Salford City Council | October 2016 2

Contents

Section Page

1. Executive summary 3

2. Audit of the accounts 5

3. Value for Money conclusion 9

4. Working with the Council 14

Appendices

A Reports issued and fees

B Recommendations

Contents


Executive summary

Overall review of

financial

statements

Purpose of this letter

Our Annual Audit Letter (Letter) summarises the key findings arising from the

work that we have carried out at Salford City Council (the Council) for the year

ended 31 March 2016.

This Letter is intended to provide a commentary on the results of our work to the

Council and its external stakeholders, and to highlight issues that we wish to draw

to the attention of the public. In preparing this letter, we have followed the

National Audit Office (NAO)'s Code of Audit Practice (the Code) and Auditor

Guidance Note (AGN) 07 – 'Auditor Reporting'.

We reported the detailed findings from our audit work to the Council's Audit and

Accounts Committee as those charged with governance in our Audit Findings

Report on 24 August 2016.

Our responsibilities

We have carried out our audit in accordance with the NAO's Code of Audit

Practice, which reflects the requirements of the Local Audit and Accountability

Act 2014 (the Act). Our key responsibilities are to:

• give an opinion on the Council's financial statements (section two)

• assess the Council's arrangements for securing economy, efficiency and

effectiveness in its use of resources (the value for money conclusion) (section

three).

In our audit of the Council's financial statements, we comply with International

Standards on Auditing (UK and Ireland) (ISAs) and other guidance issued by the

NAO.

Our work

Financial statements opinion

We gave an unqualified opinion on the Council's financial statements on 24 August

2016.

Value for money conclusion

We were satisfied that the Council put in place proper arrangements to ensure

economy, efficiency and effectiveness in its use of resources during the year ended

31 March 2016. We reflected this in our audit opinion on 24 August 2016.


Overall review of

financial

statements

Whole of government accounts

We completed work on the Council's consolidation return following guidance

issued by the NAO and issued an unqualified report on 21 October 2016

Certificate

We certified that we had completed the audit of the accounts of Salford City

Council in accordance with the requirements of the Code on 21 October 2016.

Certification of grants

We also carry out work to certify the Council's Housing Benefit subsidy claim on

behalf of the Department for Work and Pensions. Our work on this claim is not

yet complete and will be finalised by 30 November 2016. We will report the results

of this work to the Audit and Accounts Committee in our Annual Certification

Letter.

Other work completed

Council Finance staff attended a workshop we provided in November 2015 on the

early closure of local authority accounts, and a workshop we provided jointly with

CIPFA in February 2016 covering changes to accounting standards and the Code

of Practice, and emerging issues and future developments.

Working with the Council

We would like to record our appreciation for the assistance and co-operation

provided to us during our audit by the Council's staff.

Grant Thornton UK LLP

October 2016


Audit of the accounts

Overall review of

financial

statements

Our audit approach

Materiality

In our audit of the Council's accounts, we use the concept of materiality to

determine the nature, timing and extent of our work, and in evaluating the results

of our work. We define materiality as the size of the misstatement in the financial

statements that would lead a reasonably knowledgeable person to change or

influence their economic decisions.

We determined materiality for our audit of the Council's accounts to be £14.89m,

which is 2% of the Council's gross revenue expenditure. We used this benchmark,

as in our view, users of the Council's accounts are most interested in how it has

spent the income it has raised from taxation and grants during the year.

We also identified the following items as sensitive items that were material by

nature rather than size for which any errors identified would be discussed with a

view to requesting amendment depending on their nature and individual

significance:

• cash and cash equivalents

• officers' remuneration, salary bandings and exit packages

• auditor remuneration

• related party transactions

• members' allowances

We set a lower threshold of £0.745m, above which we reported errors to the Audit

and Accounts Committee in our Audit Findings Report.

The scope of our audit

Our audit involves obtaining enough evidence about the amounts and

disclosures in the financial statements to give reasonable assurance that they are

free from material misstatement, whether caused by fraud or error.

This includes assessing whether:

• the Council's accounting policies are appropriate, have been consistently

applied and adequately disclosed;

• significant accounting estimates made by management are reasonable; and

• the overall presentation of the financial statements gives a true and fair view.

We also read the narrative report and annual governance statement to check

they are consistent with our understanding of the Council and with the accounts

on which we give our opinion.

We carry out our audit in line with ISAs (UK and Ireland) and the NAO Code

of Audit Practice. We believe the audit evidence we have obtained is sufficient

and appropriate to provide a basis for our opinion.

Our audit approach was based on a thorough understanding of the Council's

business and is risk based.

We identified key risks and set out overleaf the work we performed in response

to these risks and the results of this work.


Audit of the accounts – Salford City Council

Overall review of

financial

statements

Risks identified in our audit plan How we responded to the risk

Management over-ride of controls

Under ISA (UK&I) 240 it is presumed that the risk of

management over-ride of controls is present in all

entities.

As part of our audit work we:

reviewed entity controls in relation to journal transactions

tested journal entries

reviewed accounting estimates, judgements and decisions made by management

reviewed unusual significant transactions

We did not identify any issues to report

Valuation of property, plant and equipment

The Council re-values its assets on a rolling basis over

a four year period. The Code requires that the Council

ensures that the carrying value at the balance sheet

date is not materially different from current value.

This represents a significant estimate by management

in the financial statements.


reviewed management's processes and assumptions for the calculation of the estimate

• held discussions with the Valuer about the basis on which the valuation is carried out and challenged key assumptions

• reviewed and challenged the information used by the Valuer to ensure it is robust and consistent with our

understanding

• reviewed the instructions issued to valuation experts and the scope of their work

• reviewed the competence, expertise and objectivity of the valuer used by management

• tested revaluations made during the year to ensure they were input correctly into the Council's asset register

• evaluated the assumptions made by management for those assets not revalued during the year and how

management has satisfied themselves that these are not materially different to current value.


Valuation of pension fund net liability

The Council's pension fund asset and liability as

reflected in its balance sheet represent significant

estimates in the financial statements.


identified the controls put in place by management to ensure that the pension fund liability is not materially misstated

assessed whether these controls were implemented as expected and are sufficient to mitigate the risk of material

misstatement

reviewed the competence, expertise and objectivity of the actuary who carried out your pension fund valuation and

gained an understanding of the basis on which the valuation is carried out

completed procedures to confirm the reasonableness of the actuarial assumptions made

reviewed the consistency of the pension fund asset and liability and disclosures in notes to the financial statements

with the actuarial report from your actuary.


These are the risks which had the greatest impact on our overall strategy and where we focused more of our work.


Audit of the accounts – Salford City Council (continued)

Overall review of

financial

statements

Risks identified in our audit plan How we responded to the risk

Valuation of surplus assets and investment property

The CIPFA Code of Practice implemented International

Financial Reporting Standard (IFRS) 13 for the 2015/16 financial

statements. The Council is required to include surplus assets

within property, plant and equipment in its financial statements

at fair value, as defined by IFRS13.

The basis on which fair value is defined for investment property

is also different to that used in previous years.

This represents a significant change in the basis for estimation

of these balances in the financial statements.

There are also extensive disclosure requirements under IFRS

13 which the Council needs to comply with.


reviewed management's processes and assumptions for the calculation of the estimate

reviewed the competence, expertise and objectivity of the management experts used

reviewed the instructions issued to valuation experts and the scope of their work

discussed with the valuer the basis on which the valuation is carried out and challenged the key assumptions

reviewed and challenged the information used by the valuer to ensure it is robust and consistent with our

understanding

tested revaluations made during the year to ensure they were input correctly into the Council's asset register

reviewed the disclosures made by the Council in its financial statements to ensure they are in accordance

with the requirements of the CIPFA Code of Practice and IFRS 13.

We agreed some additional disclosures in the accounts for IFRS 13 in respect of financial instruments

but did not identify any other issues to report.


Audit of the accounts

Overall review of

financial

statements

Audit opinion

We gave an unqualified opinion on the Council's accounts on 24 August 2016, in

advance of the 30 September 2016 national deadline.

The Council made the accounts available for audit in line with the agreed

timetable, and provided a good set of working papers to support them, although

some working papers were not received at the start of the audit. The finance team

responded promptly and efficiently to our queries during the course of the audit.

We will continue to work with Finance staff to identify further improvements to

the efficiency of the accounts production and audit processes to enable the earlier

deadlines for 2017/18 to be met, which will require councils to bring forward the

approval and audit of financial statements to 31 May and 31 July respectively.

The draft financial statements recorded total comprehensive income and

expenditure of £(107.239m). This remained unchanged following completion of

our audit, although various amendments were made following our audit in respect

of disclosure and classification changes. These related mainly to disclosures on the

Council's Property, Plant and Equipment assets and Private Finance Initiative

(PFI) schemes, but had no impact on the Council's reported financial position for

2015/16.

Issues arising from the audit of the accounts

We reported the key issues from our audit of the accounts of the Council to the

Council's Audit and Accounts Committee on 24 August 2016.

As a result of our work, we identified some areas for further improvement and

agreed with management recommendations to address them. These are listed at

Appendix B.

Annual Governance Statement and Narrative Report

We are also required to review the Council's Annual Governance Statement and

Narrative Report. It published them on its website with the draft accounts in

line with the national deadlines.

Both documents were prepared in line with the relevant guidance and were

consistent with the supporting evidence provided by the Council and with our

knowledge of the Council. We agreed a small number of amendments and

additions to both documents and have made a recommendation relating to the

narrative report (see Appendix B).

Whole of Government Accounts (WGA)

We carried out work on the Council's consolidation schedule in line with

instructions provided by the NAO . We issued a group assurance certificate

which did not identify any issues for the group auditor to consider.

Other statutory duties

We also have additional powers and duties under the Act, including powers to

issue a public interest report, make written recommendations, apply to the

Court for a declaration that an item of account is contrary to law, and to give

electors the opportunity to raise questions about the Council's accounts and to

raise objections received in relation to the accounts.

We did not identify any issues that required us to apply our statutory powers

and duties under the Act. We did not receive any objections from electors to

the 2015-16 accounts. There were no circumstances that required us to issue a

public interest report in respect of our 2015/16 audit.


Value for Money conclusion

Overall review of

financial

statements

Background

We carried out our review in accordance with the NAO Code of Audit Practice

(the Code), following the guidance issued by the NAO in November 2015 which

specified the criterion for auditors to evaluate:

In all significant respects, the audited body takes properly informed decisions and deploys resources

to achieve planned and sustainable outcomes for taxpayers and local people.

Key findings

Our first step in carrying out our work was to perform a risk assessment and

identify the key risks.

The key risks we identified and the work we performed is set out in table 2

overleaf.

We concluded that:

• The Council had appropriate arrangements in place for monitoring and

reporting the revenue and capital position, managing financial pressures and

identifying and delivering savings measures. There were also effective

arrangements for setting the annual budget and forecasting the medium term

financial strategy. The Council will need to continue to monitor closely and

manage financial risks during 2016/17 if it is to again achieve its financial

targets.

• The Council worked effectively with its partners to implement its two key

projects for integrated care, which were the expansion of the £116m Older

People's pooled budget to a wider pooled budget covering all adults totalling

approximately £236m and the development of an Integrated Care Organisation

(ICO) for the integrated provision of adult social care, community and hospital

mental and physical health services. Associated risks were identified and action

plans put in place to address them and progress and proposals were reported to

the City Mayor and Cabinet.

Overall VfM conclusion

We are satisfied that in all significant respects the Council put in place proper

arrangements to secure economy, efficiency and effectiveness in its use of

resources for the year ending 31 March 2016.


Value for Money

Overall review of

financial

statements

Risk identified Work carried out Findings and conclusions

Financial position and future year

savings

The Council is facing a continued period of

austerity. Having made over £118m of

budget savings in the period 2010/11 to

2014/15, the Council has a savings target

of £31m in 2015/16. The current updated

medium term financial strategy forecasts

savings required in 2016/17 of £21.8m and

funding gaps of £14.8m in 2017/18,

£14.8m in 2018/19 and £12.1m in

2019/20.

This requires the redesign and

transformation of services to help deliver

the future savings required.

We reviewed:

• the reasonableness of assumptions in the

updated MTFS

• the Council's arrangements for identifying,

agreeing and delivering savings plans including

implementation of the transformation programme

• financial and budget reporting to Members

• the outturn position for 2015/16 and the budget

plan for 2016/17

We also met with key officers to discuss key

strategic challenges and the Council's proposed

response.

The revenue and capital position are reported to the Corporate Management

Team (CMT), the City Mayor's briefing and then to the Overview and Scrutiny

Board (OS&B). Reports were presented to O&SB in September and December

2015 and February and July 2016, providing the current position, forecasts to

year end, details of risks and pressures in service groups and an assessment of

the risks to the achievement of the savings target.

A forecast adverse variance at year end of £2.652m was reported to O&SB in

December 2015 but improved to a forecast adverse variance of £0.872m in

February 2016. The Council achieved a final outturn position at 31 March 2016

of £1.311m favourable variance against the £207.739m annual budget. All

service groups either underspent or met their service budget.

For 2015/16, the council set a minimum level of general fund reserves of £8.4m,

a desirable target of £14.6m and forecast a balance of £13.6m at 31 March

2016, the same as the previous year. At 31 March 2016 the actual general fund

reserves balance was £14.37m, £0.8m more than the original budget forecast,

but still below the desirable level.

The final capital spend was £78.483m against a final capital programme of

£95.919m. We understand most of the £17.436m underspend will be slippage

into the 2016/17 capital programme subject to review and approval by CMT and

O&SB.

The 2016/17 budget and medium term financial strategy to 2019/20 was

prepared by the Director of Finance and Corporate Business in consultation with

Strategic Directors and Heads of Service. It was considered by Cabinet in

February 2016 before being presented to and approved by full Council on 24

February 2016. This included details of the planned measures to deliver the

£21.8m new transformational savings, efficiencies and additional income

required to balance the 2016/17 budget. The 2016/17 budget includes

appropriate assumptions for key income and expenditure amounts.

Table 2: Value for money risks


Value for Money (continued)

Overall review of

financial

statements


Savings measures were developed by the City Mayor, Deputy Mayor, Directors and Executive Lead

Members working with the Budget Strategy Group. The Council has also encouraged engagement

by staff and the public on its savings proposals and service reform and transformation plans through

the weekly 'City Director's update' briefing. This outlines current issues, developments and

challenges for the Council. Staff were asked in January 2016 to comment on the savings proposals

and regular 'Shaping Our City Staff Bulletin' emails on the progress made in developing new digital

customer business models have been issued, inviting staff comments and ideas and providing

details of staff briefing sessions. The Council's 'Shaping our City' public website also provides

further information on the transformation programme and invited the public to get involved.

The Council's savings measures and transformation programme are subject to appropriate review

and approval, with business cases proposing changes and efficiencies in services being taken to

Cabinet for approval. This included the Customer Transformation Service Design and Business

Case which was approved by Cabinet in December 2015 and the Customer Strategy which was

approved by Cabinet in June 2016. Through this transformation work the Council aims to change

the way customers interact with the Council through its 'Customer Business Model' programme to

enable more online interaction by the public with the Council. The Council aims to deliver £7m of

savings over the life of the project.

Delivery of savings and the reform and transformation of services are both identified as significant

risks on the Council's Strategic Risk Register. Arrangements are in place to monitor and manage

these risks through monthly monitoring against savings targets and budgets. Savings delivery and

risks are monitored via a 'RAG' (Red, Amber, Green) rating tracker. The current savings tracker

covers savings measures totalling £24m with current ratings of:

• £9.7m Green: low risk - saving achieved or low likelihood of not being achieved

• £10.4m Amber: medium risk - saving assumed as achieved in year end forecast

• £3.9m Red: high risk - the saving is not assumed to be achieved in year end forecast

As at the end of June 2016, the Council's projected position for the year ending 31 March 2017 is an

adverse variance of £3.849m. and an adverse variance of £0.295m on the Dedicated

Schools Grant (DSG) budget. The Council has a track record of achieving savings targets and

identifying alternative measures and mitigating actions where planned savings measures are not

delivering the target savings in order to deliver within budget.

On that basis we concluded that the risk was sufficiently mitigated and the Council has

proper arrangements in place the meet its responsibilities.



Overall review of

financial

statements


Health & Social Care Integration

The Council is seeking to deliver wide

ranging changes and greater integration to

ensure the financial sustainability of adult

health and social care services. The

Council aims to expand its Integrated Care

Organisation and pooled budget

arrangements for Older People to cover

health and social care budgets for all

adults. Working with partners from

different organisations and service areas

with potentially conflicting priorities, the

project is complex and high profile.

We reviewed the project management and risk

assurance frameworks established by the

Council to establish how it is identifying,

managing and monitoring these risks.

The Council has worked with its partners to implement two key projects for integrated

care. The first is the expansion of the £116m Older People's pooled budget to a wider

pooled budget covering all adults totalling approximately £236m. The second is the

development of an Integrated Care Organisation (ICO) for the integrated provision of

adult social care, community and hospital mental and physical health services.

Both projects are recognised on the Council's Strategic Risk Register as 'Actively

Managed Risks'. The register provides details of the actions in place to manage and

mitigate the risks. This includes appropriate partnership arrangements to expand the

Integrated Care Programme for Older People to cover the whole adult population of

Salford, and to put in place the required agreements to establish the ICO and the

required commissioning and governance arrangements.

Sufficient arrangements are in place to consult and communicate key decisions on

partnership working within the Council. The City Mayor and Cabinet have received

reports on progress and the proposed agreements and governance arrangements put

in place for the wider pooled budget and the ICO.

The Council and Salford Clinical Commissioning Group (CCG) have operated a

pooled budget for health and social care services for Older People since April 2014.

In March 2016 the Council and the CCG agreed that the pooled budget would be

extended from April 2016 to include health and social care services for all adults. A 5

year Service and Financial Plan is being developed for the wider pooled budget

based on the original one for Older People services and a risk share agreement is in

place.

The Salford Alliance Partnership comprises of the Council, the CCG, Salford Royal

Foundation Trust (SRFT) and Greater Manchester West Mental Health Foundation

Trust. It is supported by an Alliance Agreement between the partners, who have

worked together to establish the ICO. The Alliance Board met regularly during the

year with representatives from all the partners. Discussions included finance and

activity, performance metrics, the risk register and the development of the ICO.

The full business case for the ICO was approved by the Council and its health

partners, which is evidence that the partners have been able to work together to

agree detailed plans for the organisation.



Overall review of

financial

statements


The original planned commencement date of 1 April 2016 was deferred to allow

time for due diligence to be completed on both sides. Subsequently 400 Adult

Social Care staff transferred from the Council to SRFT and the ICO was

launched on 1 July 2016, with SRFT as the prime provider of adult social care.

The Alliance Agreement, including the Alliance Board, have been disestablished

and revised governance arrangements put in place for the integrated care

system infrastructure. The Salford Health and Wellbeing Board oversees the

integrated care system and an Integrated Adult Health and Care Commissioning

Joint Committee has been established to oversee the pooled budget

arrangements between the Council and the CCG. An Advisory Board for

Integrated Care has also been established to advise on the development of

service strategy and oversee the Integrated Care Vanguard Programme.

In June 2016 the Council's internal auditors reported on their joint review with

the CCG's internal audit providers of the integrated care service governance

arrangements for commissioning and concluded they were fit for purpose.

The Council will need to ensure it maintains sufficient arrangements with the

CCG for commissioning services from the ICO and monitoring its performance,

managing the associated risks on a longer term basis for the benefit of its own

governance as well as reassuring external stakeholders.

On that basis we concluded that the risk was sufficiently mitigated and the

Council has proper arrangements in place for managing arrangements

with third parties effectively to deliver its strategic priorities.



Overall review of

financial

statements

Our work with you in 2015/16

We are really pleased to have worked with you over the past year. We

have established a positive and constructive relationship. Together we

have delivered some great outcomes.

An efficient audit – the accounts audit was substantially complete by the

end of July and we issued our audit opinion on 24 August 2016, following

the approval of the accounts that day by the Audit and Accounts

Committee. This was over a month before the deadline of 30 September

and in line with the timescale we agreed with you. Our audit team are

knowledgeable and experienced in your financial accounts and systems.

Our relationship with your team provides you with a financial statements

audit that continues to finish ahead of schedule releasing your finance

team for other important work.

Understanding your operational health – through the value for money

conclusion we provided you with assurance on your operational

effectiveness.

Sharing our insight – we provided regular updates to the Audit and

Accounts Committee covering best practice. Areas we covered included

Innovation in public financial management and Knowing the Ropes –

Audit Committee Effectiveness Review and Reforging local government.

Thought leadership – We have shared with you our publication on

Building a successful joint venture and will continue to support you as you

consider greater use of alternative delivery models for your services.

Providing training – we provided workshops on financial accounts issues

and early closure. The courses were attended by members of your team who

are responsible for the production of the annual financial statement of

accounts. We have also provided briefing sessions for the Audit and

Accounts Committee on the role of external audit.

Providing information – We provided you with information on CFO

insights, our online analysis tool providing you with access to insight on the

financial performance, socio-economy context and service outcomes of

councils across the country.



Overall review of

financial

statements

Working with you in 2016/17

Highways Network Asset

The Code of Practice on Local Authority Accounting (the Code) requires

authorities to account for Highways Network Asset (HNA) at depreciated

replacement cost (DRC) from 1 April 2016. The Code sets out the key

principles but also requires compliance with the requirements of the

recently published Code of Practice on the Highways Network Asset (the

HNA Code), which defines the assets or components that will comprise the

HNA. This includes roads, footways, structures such as bridges, street

lighting, street furniture and associated land. These assets should always

have been recognised within Infrastructure Assets.

The Code includes transitional arrangements for the change in asset

classification and the basis of measurement from depreciated historic cost

(DHC) to DRC under which these assets will be separated from other

infrastructure assets, which will continue to be measured at DHC.

This is expected to have a significant impact on the Council's 2016/17

accounts, both in values and levels of disclosure, and may require

considerable work to establish the opening inventory and condition of the

HNA as at 1 April 2016.

Under the current basis of accounting values will only have been recorded

against individual assets or components acquired after the inception of

capital accounting for infrastructure assets by local authorities. Authorities

may therefore have to develop new accounting records to support the

change in classification and valuation of the HNA.

The nature of these changes means that Finance officers will need to work closely

with colleagues in the highways department and potentially also to engage other

specialists to support this work.

Some of the calculations are likely to be complex and will involve the use of

external models, a combination of national and locally generated rates and a

number of significant estimates and assumptions.

We have been working with the Council on the accounting, financial reporting

and audit assurance implications arising from these changes. We have issued two

Client Briefings which we have shared with Finance staff. We will issue further

briefings during the coming year to update the Council on key developments and

emerging issues.

This accounting development is likely to be a significant risk for our 2016/17

audit, so we have already had some preliminary discussions with the Council to

assess the progress it is making in this respect. We confirmed that Finance staff

have had on-going discussions with Urban Vision, who maintain the inventory of

Infrastructure Assets, to identify those assets and components that will comprise

the HNA. Work is on-going by Urban Vision and Finance staff to ensure the

required data is input into the modelling tools that will produce the required

balances for the 2016/17 accounts.

We will continue to liaise closely with the senior finance team during 2016/17 on

this important accounting development, with timely feedback on any emerging

issues.

The audit risks associated with this new development and the work we plan to

carry out to address them will be reflected in our 2016/17 audit plan.



Overall review of

financial

statements

.

We will also continue to work with you and support you over the next financial

year in other areas.

Locally our focus will be on:

• An efficient audit – continuing to deliver an efficient audit and continuing our

work with the Finance team to ensure the achievement of the earlier accounts

deadline in 2017/18

• Improved financial processes – we will focus our work on the identification

and delivery of actions and measures to maintain revenue spend within the

approved budget, including planned savings measures


Appendix A: Reports issued and fees

Fees

Planned

£

Actual fees

£

2014/15 fees

£

Statutory audit of the Council 137,030 137,030 182,706

Housing Benefit Grant Certification 20,993 To be

confirmed*

24,870

Total fees (excluding VAT) 158,023 137,030 207,576

We confirm below our final fees charged for the audit and provision of non-audit services

Reports issued

Report Date issued

Audit Plan March 2016

Audit Findings Report August 2016

Annual Audit Letter October 2016

Fees for other services

Service Fees £

Audit related services:

Western Gateway Infrastructure Scheme at Port Salford – Regional Growth

Fund:

• Return 16/1/14-31/3/15

• Additional outputs return 16/1/14-31/3/15

Teachers' Pensions Return 2014/15

Pooling of housing capital receipts return 2014/15

2011-15 Programme Agreement for Affordable Homes grant schemes

Total

5,000

2,500

4,200

2,700

3,000

17,400

Non-audit services Nil

*Work on the Housing Benefit Grant Certification is in progress with a deadline of

30 November 2016 and so the actual fee will be confirmed when this work is

complete.


Appendix B: Recommendations

Rec

No. Issue and recommendation Priority Management response

Implementation date &

responsibility

1. A number of working papers were not received at

the commencement of the audit.

Recommendation: Ensure all supporting working

papers are complete and available at the start of

the audit.

High Working paper check to be included in final accounts

timetable.

November 2016

2. Code paragraph 3.1.5.3 b) requires that the

Narrative Report should "provide an analysis of

the financial and non-financial performance

indicators as relevant to the performance of the

authority". Whilst the Council's core performance

measures are listed in the Narrative Report, no

information is provided on actual performance

against them during the year.

Recommendation: Provide details of actual

performance against the Council's core

performance measures listed in the Narrative

Report.

Medium Performance information is routinely provided on

thematic reports to Scrutiny at their request on an ad

hoc basis. We are currently discussing a performance

framework with the City Mayor including how we make

the information more open and transparently available.

January 2017

Assistant Director Strategy

Change

3. Amendments were made for errors identified in

PFI amounts disclosed in note 43 'payment

periods table'. These were due to errors in

amounts recorded in the supporting working

papers. This indicated a lack of robust

management review of the supporting working

papers and calculated amounts.

Recommendation: Ensure sufficient

management review and checks of material PFI

calculations and supporting working papers.

Medium Validation check formula to be added to working

papers to ensure consolidated costs included in note

43 match individual PFI / LIFT working papers.

Formula errors included in original note 43

consolidation working papers that led to

misstatement of future liabilities have already been

corrected.

Additional management review time will be

incorporated in to final accounts timetable to ensure

accuracy of working paper

Formula errors already corrected.

Validation formula to be added

August 2016

Review time to be included in

16/17 accounts timetable.


Appendix B: Recommendations (continued)

Rec

No. Issue and recommendation Priority Management response

Implementation date &

responsibility

4. We identified that the amounts of members'

allowances published on the Council's website did

not reconcile to note 35 in the accounts. The

website amounts were amended to reconcile to

the accounts.

Recommendation: Reconcile members'

allowances details to the amounts disclosed in the

accounts before they are published on the

Council's website. published on the website.

High Members' allowances details were reconciled to the

amounts disclosed in the accounts. The initial version

provided to members services was not the version

uploaded by IT services to the website. In future once

the amounts have been through the review process

with members the finance team will arrange for the

file to be uploaded to the website.

July 2017

The Annual Audit Letter for Salford City Council City Council.pdftested revaluations made during the...

Documents

Transcript of The Annual Audit Letter for Salford City Council City Council.pdftested revaluations made during the...