To receive a report from the External Audit Manager, Forvis Mazars.

Mark Surridge, External Auditor, Forvis Mazars was in attendance virtually to present Members with the Draft Value For Money (VFM) Progress Report 2021/22 and 2022/23 for the year ended 31 March 2022 and 31 March 2023, pages 1 to 24 of the Agenda refer.

Members were advised that the External Auditors work on the VFM arrangements was substantially well progressed and that following an objection to the Financial Statements received on 9th November 2024, the report was being issued to represent findings prior to this objection and that the findings were subject to revision.

Members were invited to put their comments and questions forward.

·         A Member commented that Invest East Lindsey should be added to the Council’s Risk Register due to the potential financial and reputational risks that its operation could bring to the Council.  In, response, the External Audit Manager, Forvis Mazars advised Members that the risk had been recognised in their recommendations and that the external auditors wanted to ensure that the Audit and Governance Committee had full oversight.

·         A Member queried whether a comprehensive update on Invest East Lindsey could be provided to the Committee in the future.  In response, the Section 151 Officer advised Members that a substantial number of reports on Invest East Lindsey, including a recent report that went to Full Council, were already available and could be provided to the newer Members of the Committee.

·         In reference to Appendix A – ‘Further information on our audit of the financial statements’, a Member requested an update on the steps that had been taken in relation to the production of the draft accounts and working papers as noted in the Management response, page 21 of the Agenda refers. 

In response, the Deputy Chief Finance Officer (Corporate), PSPS Limited advised Members that a timetable for producing the Financial Statements and working papers was being drafted and that the previous year’s timetable was being rolled forward with the revised dates for the financial statements deadline of 30th June 2025.  Members were further assured that year-end memos were produced and circulated to all officers, budget managers and business partners and that all preparatory work was well advanced in preparation for the year end of 31st March 2025.

·         In reference to the Council’s spending benchmarks, the Chairman queried the way in which the benchmarks accounted for government grants and the reasons that the Council were spending more per head across the district compared to the average for all other English district local authorities, page 9 of the Agenda refers.

In, response, the External Audit Manager, Forvis Mazars advised Members that the graph represented the period from 2017/18 to 2022/23 and that a weblink had been included to provide a breakdown of the details per service line.  Members were advised that the costs did not include additional grants such as the Towns Fund, as the spending was based on revenue expenditure.  Members were further advised that the Council’s spending was generally larger due to its locality and population.

The External Audit Manager, Forvis Mazars further assured Members that the external auditors had concluded that the Council’s spending had not presented a significant concern.

The Section 151 Officer further supported that the largest factor in the Council’s revenue expenditure position was the rurality and size of the district.

·         A Member queried whether extra funding was available from the government to ease pressures on the Council due to its size and rural location.  In response, the Section 151 advised Members that national lobbying was underway for many rural authorities whose funding settlement would greatly benefit from being adjusted to reflect their locality. 

There were no further comments or questions received.

Following which it was,

RESOLVED:

That the Draft Value For Money Progress Report 2021/22 and 2022/23 be noted.