Agenda item

The Manager, Grant Thornton introduced the report that provided a statement as to the progress of the Group PPE element of the External Audit. They had identified that there was a difference of opinion between the expert that the auditors had used and the expert that management had used, which was resulting in a potentially material difference in valuation of the battery site in Taunton. A decision had been agreed whereby a third party would be involved to produce a further valuation to take the matter forward and conclude work in the area. This was the key reason why the final audit report was unable to be produced.

In response to questions raised by members the Chief Finance Officer, Lead Finance Officer, Monitoring Officer, and the Key Audit Partner Grant Thornton gave the following responses.

·         A written response from the relevant officer would be given about whether the new valuation report would include the disposal of the batteries at the end of their life.

·         A separate valuer had been engaged and was being finalised. The timescale would be better known in a few days but it was thought the valuer would need around 1 month before the auditors were able to review the report, finalise their work and come back with any follow up questions.

·         The valuation had no impact on the revenue or capital expenditure

·         The current issue with the valuation only related to the Taunton site as it was currently the only site energised and operational.

·         The total fee that was in the audit plan that had been previously presented to committee was expected to be £67,000. The final additional fees will be up from that figure.

·         Several reasons and pressures had attributed to the increase in fees, a breakdown of increase would be provided to members if possible.

·         The finance team were in the process of filling a vacant SSDC finance post.

·         The exercise was to find out what the fair value of the asset was at the close of the accounting period 2020/21.

·         The payment made to the employee was identified and backing documents were made available to the Auditors by officers when requested. 

·         The payment was known by officers after the event by undertaking the last quarters budget monitoring review, it showed an overspend and the money was identified.

·         The previous CEO was not given any similar payment. He resigned his position and left the authority after his notice period.

·         In settlement agreements it was normal to have a confidentiality agreement. The rules around public sector settlements at the time allowed for this.

·         Members were advised not to make any assumption about which individual received the payment.

·         The Chief Executive explained that she made the leader aware of the payment when she was made aware of the payment within the first month of joining the council. Internally it was made clear that the process followed at that time would not be allowed to happen again.

There were no further questions from members and the Chairman thanked the auditors for the progress update.