The Council’s External Auditor EY will provide an update on the 2019/20 audit process and present their 2020/21 External Audit Plan.

Mark Sanders, Chief Accountant, submitted a covering report on the 2019/20 audit process and EY’s 2020/21 External Audit Plan, which was attached as an Appendix to the report.

Maria Grindley and Adrian Balmer, EY, presented the draft Audit Plan for 2020/21 summarising the initial assessment of the key risks driving the development of an effective audit for the Council and outlining EY’s planned audit strategy in response to those risks.  The Committee would be updated on the ongoing planning procedures, if there were any significant changes or revisions at its next meeting.  The external auditors provided their assessment of the audit risks and key areas of focus.

The Committee was asked to confirm its understanding of, and agreement to, the materiality and reporting levels in the 2020/21 accounts.  For planning purposes, group materiality for 2020/21 had been set at £5.615m, which represented 1% of the Council’s 2020/21 unaudited group gross expenditure on provision of services.  In relation to single-entity materiality for 2020/21 this had been set at £4.73 million, which represented 1% of the Council’s 2020/21 unaudited gross expenditure.  Both group and single-entity materiality would be reassessed throughout the audit.  Maria Grindley explained that materiality had been set quite low due to the need for assurance that the issues identified with the finalising accounts over previous years had been corrected.  The expectation would be that as fewer accounting errors were found the materiality threshold could rise, which could reduce the amount of testing and work required to complete the audit.

Resolved:

(1)          That EY’s update on the accounts process be noted;

(2)          Thatthe 2020/21 External Audit Plan be noted;

(3)          That the group and single-entity materiality and reporting levels in the 2020/21 accounts be agreed.