Agenda item

Jon Roberts and Ginette Beal, Grant Thornton, were in attendance for this item. The key findings of the report were summarised for the benefit of the Committee and the following discussion points followed:-

1.      The Statement of Accounts 2020/21, although approved by the Audit Committee, had not yet been signed due to a new element of the CIPFA code which required all Local Authorities to produce a value on all infrastructure assets. This was proving a real challenge to Local Authorities due to the level of detail needed. CIPFA had therefore developed a proposal which was due to be considered by the CIPFA panel and then the Financial Reporting Advisory Board. The outcome of this would be known this week and if the proposals were approved progress could be made quickly;

2.      Councillor Gollop observed that infrastructure assets would never be sold anyway and therefore suggested that the accounts could be signed with a note from Grant Thornton  concerning the outstanding issue. The Director - Finance reported that this point had been reflected by BCC to CIPFA as part of its consultation. The LGA had also responded and it was hoped that CIPFA would be able to show some pragmatism;

3.      GT had spent some time exploring why the majority of capital expenditure occurred in the final quarter of the financial year but had not been able to establish the  reason. The Director – Finance observed that Local Authorities worked at a real pace to get capital expenditure over the line before the end of the financial year. She reported that Internal Audit had been asked to undertake a quick review to see if practices were appropriate. GT agreed to reappraise the Committee in 3 months on the matter;

4.      In response to a question from Councillor Eddy GT were unable to comment on whether the costs of Bristol Beacon would increase beyond the current projected spend but reported that arrangements were more reliable now than they had been at the start of the project. It was noted that costs of goods were increasing which was also a risk;

5.      Councillor Gollop found the report concerning. He was surprised by the level of overspend on the Bristol Beacon and it had all been written off because of the peppercorn rent. He asked whether an action plan would be produced to prioritise the recommendations and whether the Committee would be kept up to date on progress. The Director – Finance responded that there were 3 themes running through the recommendations – The need for recurrent savings, the development of procurement strategy in order to address breaches and financial sustainability as reflected in Dedicated Schools Grant deficit. Audit Committee and Scrutiny Commissions should focus on these areas. Simon Cookson stated that the breath of recommendations were helpful and that it would be helpful for the Committee to receive a formal update during the year in order to provide good assurance;

6.      The Director – Finance, in response to an enquiry, reported that procurement breaches could come in a number of forms and were directorate wide;

7.      In relation to achieving sustainability for the Dedicated Schools Grant budget there were two DfE schemes – Safety Valve was for LA’s who had achieved sustainability and Delivering Better Value which helped LA’s to achieve sustainability. One scheme did not preclude you from another. In response to a question from Councillor Kent GT confirmed that they would expect a call on general balances and management to show how it managed and risk assessed the deficit in the context of its rules on general reserves. It would not expect to see a dedicated reserve;

8.      Councillor Breckels referred to Recommendation 2 and suggested that consideration should be given to other ways of bringing in revenue and that ideas be tested for viability. The Director – Finance replied that the Executive Director – Growth and Regeneration had led on developing propositions for 2022/23 and a long list had been whittled down to move forward with. It was a challenging situation and all avenues were being explored;

9.      GT confirmed that carbon and environmental measures being built into efficiency/effectiveness recommendations wre raised last year and was an area to build into their risk assessment for value for money;

10.  The Committee noted that there was currently no procurement strategy as a commercial strategy was to be developed and would have incorporated procurement. Work was now underway with a Resources Commission Task and Finish Group tasked with developing it. It would not overlap with climate ambitions and would be an overarching strategy which didn’t do too many things and aligned with the Council’s other strategies;

11.  The Chair thanked GT for a comprehensive report and asked to be kept updated on the three themed areas for focus.

Resolved -  That Grant Thornton’s Interim Auditors Annual Report for 2020/21, focusing on their value for money assessment, along with an action plan agreed by management be noted.