Agenda item

Grant Thornton – new external auditors

Peter Barber (Associate Director) of Grant Thornton the council’s new external auditor introduced himself and his colleagues Peter Smith (Engagement Manager) and Paul Benfield (Audit Executive).  He had felt it was important to bring the whole team to their first meeting with the Audit Committee and expressed Grant Thornton’s delight at being appointed the council’s external auditor service for the coming five years.

He explained that the main driver behind their appointment had been the GO Shared Service with the Forest of Dean, Cotswolds and West Oxfordshire for whom Grant Thornton already acted as external audit services.  It was considered that this would enable the most effective audit, avoid duplication and in turn provide economies of scale.  With the transfer from the Audit Commission on the 1^st November he admitted that Grant Thornton were slightly behind and as such the fee letter was deliberately brief and no initial risks had been detailed.  The scale fee, as set out in the letter, was set and confirmed by the Audit Commission at £108,290 and with the reduction of 40% this would be £64,974 and Grant Thornton would be seeking to discharge their responsibilities under the current code of practice and deliver a high quality external audit service.  Up to 80% of their opinion would be based on the financial statements produced by the council, with initial governance assurance on controls and then after April, review of the substantive procedures.  Members would be aware that up until two years ago the VFM conclusion had been quite wide ranging, however, the criteria had since been reduced and now focussed on financial resilience.  Beyond the code Grant Thornton would undertake the certification of grants and returns and with the 40% reduction the fee for this service would be £12,750.

Peter Barber gave the following responses to questions from members of the committee;

• The 40% savings available to the council had been generated by the loss of the Audit Commission which had always been a large overhead for any external auditor.  He assured members that this reduction would not result in a less rigorous service and Grant Thornton would adhere to all the same standards, adopt the same approach and maintain standards as the previous external auditors.
• Items from the audit timetable would be added to the committee work plan as appropriate, these details would be forwarded to the Democracy Officer, with September being a key meeting.  Officers would be provided with initial copies of conclusions so that they are aware of any issues and Grant Thornton would work closely with Internal Audit to avoid duplication. 
• He hoped that the issue of Chinese walls and confidentiality would be clearly set out in the various contracts (Ubico, CBH, etc) from the outset.  However, these by their definition, would tend to evolve over time and it would be for each to decide what information they choose to share with other authorities, partners, etc.

The Chairman suggested that in time the committee could consider how the flow of data was working.