Audit and Governance Committee - Wednesday 10 September 2025, 6:00pm - Folkestone & Hythe webcasting

Audit and Governance Committee
Wednesday, 10th September 2025 at 6:00pm 

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  21. Webcast Finished

1 Apologies for Absence

Cllr Liz McShane - 0:00:14
Good evening, everyone, and welcome to the meeting of the Audit and Governance Committee.
This meeting will be webcast live to the Internet. For those who do not wish to be recorded or
filmed, you will need to leave the Chamber. For members, officers and others speaking
at the meeting, it is important that the microphones are used so viewers on the webcast and others
in the room may hear you. Would anyone with a mobile phone please switch it to silent
mode as they can be distracting. I would like to remind members that although we all have
strong opinions on matters under consideration, it is important to treat members, officers
and public speakers with respect. Thank you. So just before we get into the agenda items,
I'd just like to welcome Councillor Holgate to the press meeting, A &G, and in his role
as vice chair as well. Okay, agenda item one. Have we got any apologies for that?
Thank you, Chair. We haven't received any apologies.
Microphone A - 0:01:02
And nothing from Councillor Wimble in the afternoon, are you?

2 Declarations of Interest

Cllr Liz McShane - 0:01:06
Item number two, declarations of interest, please.
Just as he got to a book between us.
Cllr John Wing - 0:01:17
Thank you. Any others? No?
Cllr Liz McShane - 0:01:18
So you're the Chair of the team.
Cllr Rich Holgate - 0:01:20
Cllr Liz McShane - 0:01:24
Thank you. Let me go to the minutes, pages 5 to 14 from the last meeting.

3 Minutes

Got any comments on the minutes presented?
No.
I've just got one on page – it's page 5.
Well, it's not page 9 at the bottom.
The last bullet point under the corporate risk register, it says about bringing a report
on cybersecurity to the September meeting.
I didn't see one in the packs.
We just have an update on that please.
Thank you, I believe that's planned for
the next committee in December.
Thank you.
Microphone A - 0:02:01
Cllr Liz McShane - 0:02:01
Cllr Liz McShane - 0:02:05
In that case, let's go on to.
Item number four. So it's one of the

4 Quarterly Internal Audit Update Report from the Head of East Kent Audit Partnership

two main items we got tonight.
The quarterly internal internal
audit update report from the head
of East Kent Audit Partnership,
and that's pages 15 to 32.
Is that Alan? Or is it? Sorry, Chris. Sorry. Thank you, Chris.
Folkestone & Hythe Officer - 0:02:32
Thank you, Chair. The report before you on page 15 is the regular internal audit update
report showing the work completed since the last committee meeting. If I can direct you
to page 19, this shows the work that's been completed in the period and there were two
main reports completed. One was housing benefit administration and assessment and the other
preparedness for the housing consumer standards. Both came out at substantial assurance levels
so there's no worries for the committee on those two accounts. Moving forward to page
22, this shows the follow -ups that have been completed for the period. There were five
in this period undertaken and the revised assurance levels came out, four came out as
substantial and one came out as reasonable. So again no particular concerns for the committee
there. On page 27 this shows the audit plan for the period to the end of the first quarter.
So the target being 25 % and we achieved 23 .16 so it's just a little bit behind and to bring
the committee up to date to the end of August the target is 42 % and the outcome is 37%.
So it's just slightly behind but that's because of the holiday season and that will be caught
up during the rest of the year.
So those are the main highlights of the report.
We're pleased to take any questions.
Thank you.
Thank you, Chris.
Cllr Liz McShane - 0:04:05
Any questions from the committee members?
Councillor Wien.
Cllr John Wing - 0:04:13
Just a brief one about the housing consumer standard which is the only one that reached a high.
It says that the management team I believe are looking into it and set up a plan to bring it down.
Is that correct?
Yes, certainly.
And the housing consumer standard was the only one
who reached high on the risk level.
Folkestone & Hythe Officer - 0:04:54
This review was undertaken because the housing regulator will be coming in at all of the
councils and looking at the consumer standards for each of the councils.
What's happened here is folks have taken the lead and they've moved forward and they've
done their own self -assessment and they've been working through that and this review
was basically to look at the self -assessment that the council had done and to see whether
it looked as though it was right on the way they were coming out with their outcomes and
targets and to what they were expecting.
The work was to highlight areas where additional work would be needed to be done before the
comes in and looking at the review that we undertook we found that the way they were
undertaking the self -assessment was good and it was coming out to what levels we were expecting
them to. So basically they are taking that forward and then any assessments that are
coming out as highlighted as medium or high they are the ones that the council then needs
to release targets and resources and to make sure that they can bring those out to a good
outcome.
Cllr Liz McShane - 0:06:15
Thank you. Any other questions? Councillor Horgett.
Cllr Rich Holgate - 0:06:20
Hi, Givin. Just had one around the progress. You said obviously seasonality has impacted
a little bit. We hope to catch that up. In terms of seasonality, we've got Christmas
this quarter, so there is an argument that there will be that impact potentially again.
do we have any mitigations for that and how else will we be able to catch up given that's
the case?
Thank you.
Folkestone & Hythe Officer - 0:06:41
Yeah, because we work across four councils we find the amounts that are undertaken sort
of ebb and flow, so one council might be slightly ahead, one council might be slightly behind,
that's on the snapshot of time.
But we normally find at the end of the year they are all pretty close to 95 to 100 % of the target.
It would just be as we find a coin council slightly behind,
then we would just target some more resources towards them
so that they can sort of catch up the plan at that particular time.
But no, we don't have any particular concerns about the completion of the plan at the moment.
Any other questions?
Cllr Liz McShane - 0:07:29
Councillor Godfrey.
Just a point of clarification for me actually.
Cllr David Godfrey - 0:07:35
On page 27 and counter fraud assurance, the only thing there I noticed was fraud arrangements.
We spent more time than we advocated time looking at those and it's come out as finalised
but reasonable.
Can I get any clarification on that?
about why it's only reasonable.
Or what is happening there.
Yes, the fraud arrangements report is one of the ones
that we've been undertaking across the four councils.
And this is the one that came out for folks.
And so coming out as reasonable we think is a good...
is a good indicator that things are progressing well.
One of the main aspects that we found in this particular fraud arrangement review
was that there's new regulations that were coming in about the prevention of fraud
and that was coming into play in September
and we were undertaking these fraud arrangements to see if things were in place
to move towards completing that.
A lot of it was around the training
and I'm pleased to say that the training has been put in place, I don't know if I would
like to put any further mention, but we found out that the folks have managed to make training
arrangements for the staff and that's going to be, if it's not already been completed,
it's going to be completed very soon.
Chair, if I may, through you, so exactly what Chris was saying, so I think when this actually
Mr Alan Mitchell - 0:09:17
piece of work was done, the legislation about preventing fork was in effect coming into
play in actually September and at that point we hadn't had training in place, that training
is now in place, it's mandatory training and from the conversation I had with the corporate
governance board the other day, pretty much everyone has now completed that training so
we are actually quite ahead of the number of other local authorities so even though
that it's far less reasonable if that's put out again, then actually we should be pretty
assured that no one...
Cllr David Godfrey - 0:09:51
No thanks, I mean it's not to say that reasonable isn't very good to see, and nothing below
that which is great, so thanks for the information.
Cllr Liz McShane - 0:09:59
Yes, thank you, that's reassuring to know that we're all ahead. I've just got one, sort
of a generic one really, but there's no higher critical recommendations are standing in this
So just be good to know how confident we are that the lower priority items will be slipping.
You know, they're still getting a lot of focus.
Okay.
Thank you, Chair.
Folkestone & Hythe Officer - 0:10:20
Yes, there's no particular areas of concern for the Committee in this period, but just
to say that obviously the checking and the recommendations will be done at the follow -up
stage and any of the follow -ups that aren't put in place, certainly on the higher recommendations
would be flagged up to this committee. But for this period, on this particular time,
there's none to bring to your attention. But it may be that there will be some at a future
time but there's certainly nothing within the period at the moment.
Cllr Liz McShane - 0:10:57
Thank you. Any more questions on this item? No. Okay. So let's go to the recommendations
which are to receive a note report and to note the results of the work carried out by
the East Kent Audit Partnership. Could I have a proposal, please? Councillor Walker, thank
you, and the seconder, Councillor Wing, lovely. And we have a vote. Are we in favour of receiving
recommendations? Unanimous. Okay, thank you. So we'll move on to agenda item 5, which is

5 Grant Thornton Audit Progress Report and Sector Update

on page 33. And it's the audit and government, it's the Grant Thornton audit progress report
and sector update. Sophia, over to you. Thank you.
SPEAKER - 0:11:41
Thank you, Chair. Good evening, members. I'd like to introduce to you Kieran here, who
is the audit manager for the 24 -25 audit of your financial statements.
For those of you who were here for the audit of the 23 -24 financial statements, the same
role was carried out by Jasmine.
Jasmine and Kieran have worked quite closely together for a good handover for Kieran taking
up the role this year.
And Kieran has been working very closely with John and with Alan in terms of the planning
for the current year's financial statements audit
and we'll take you through the progress report
and the sector updates.
Before I hand over to Kiran,
I just wanted to update the Audit Committee
on the delivery of the 24 -25 financial statements audit.
So I have signed off the audit
for the last couple of years, few years,
but I'm not going to be doing that role for this year.
I need to reduce my commitments
in the last quarter of this calendar year.
And so instead of me, it will be Paul Dossett,
who is the partner in our region of public sector audit
that we work in in Grant Thornton.
He was also the engagement lead before I was,
so he knows the council very well.
And he is also our firm's head of local government.
So you're in very good hands.
And the plan is that I will come back
and I'll pick up the audit for 25, 26, I'll be back.
And also I'll be working.
I'm not going anywhere, and I will be working with Kieran
and with Paul to make sure that if there's any questions that
only I can answer, I'll be around to do that.
So over to Kieran to take you through the progress report.
Thank you.
SPEAKER - 0:13:28
Yeah, I'll present the external audit progress report
and sector updates.
I'll take the report as read.
We'd like to bring members' attention
to some aspects of our report.
On page 41 of your packs, we highlight the audit progress to date.
At the last committee in July, we presented our final audit plan, having completed risk assessment and planning work.
Our team is now scheduled to commence the year -end audit work starting at the beginning of October, with a plan completion for December.
Ahead of the year -end visit, we have completed our interim work in July.
This included the selection of samples across key areas ahead of the field work commencement in October.
This is something that's new for this year, and it's been done with the intention of ensuring
sample evidence is available for the start of the fieldwork engagement, and this will
allow our team to go straight into testing without the beginning of the audit.
Planned audit completion is for December, and we're anticipating presenting the audit
findings report to the audit committee on the 17th of December ahead of the February
backstop deadline.
Our value for money work has commenced from July.
The delivery of our auditor's annual report will be shared with management in November
and presented at the December audit committee.
From page 47 onwards in our report,
we have the sector updates on issues
impacting local authorities,
and we've also included some resources
specific for audit committee members
at the end of our report.
I'll end it there if there's any questions.
I hope you'll answer.
Thank you, Kieran.
Cllr Liz McShane - 0:14:50
Any questions from the committee?
Councillor Wing.
Just a quick question.
It mentions in here that the local audit
Cllr John Wing - 0:14:59
reform next April by the government and I just wondered what effect this may or may
not have on the council.
Thanks Councillor Wing.
SPEAKER - 0:15:11
In terms of specific impact on the council it will be sector wide and I think it's looking
at reforms to the way that we do local audit and its impact.
So part of the consultation process has been what's the remit of the local audit office
going to be. Primarily everybody wants it to be there to have oversight of local audit
and what's happening for local audit and to bring together all the sort of disjointed
parties that are involved at the moment under one roof. And it's also to drive change in
the sector. So you'll know that a lot has happened over the last few years to get to
the point where local audit is not efficient and effective and there's lots of authorities
that have backstop audits with disclaimed opinions.
So it's how does the sector work its way through that?
How do we change the reporting to make sure that the accounts are really effective for
the users of the accounts and that we as auditors are looking at the right things?
It's looking at what capacity there is within the local audit market.
So which firms are there trying to encourage more people
to look at this as a profession and career.
And it's also looking at improving relationships
between auditors and the audited body.
So part of it will be driving change
in terms of raising the profile of some of the reports
that we have.
So one recommendation has been around the auditors
annual report and taking that to report at full council or something like that.
So that's something I've done at other authorities, that it's a drive to make sure that the profile
is raised and that more people are aware of the work that auditors do and the findings
that we have.
So there's a lot that's happening, but nothing that's certain for now.
But those are very much the intentions.
Thank you.
Thank you.
so it sounds like reforms should be beneficial.
Cllr Liz McShane - 0:17:23
Any other questions?
That's the whole game.
Cllr Rich Holgate - 0:17:30
Just one actually, which is the IFRS 16,
which feels like an element of bureaucracy ahead.
Pages 49 onwards have a fantastic set of questions
to challenge the finance team.
I'm just curious, do we have answers to all of them,
or is that what we're working through now?
Jonathan Smith - 0:17:53
Thank you Councillor Holgate. So in terms of IFRS 16, we've actually a number of years
ago in preparation for IFRS 16 coming into force, we did do some reviews about effectively
our leases and things like that, so we've already prepared the accounts with IFRS 16
in mind and obviously what we have done, what we have prepared now and what we've put on
our financial statements, obviously the orders will be sent to cheque that we've not done
it all correctly and this is just obviously a new standard and there are new learnings
and this is part of the slides in their update report which is highlighting where authorities
sometimes get it wrong however we have limited visas to be concerned with and we've prepared
our accounts and obviously the authors will validate that for you to give you the comfort
that how we presented our accounts is correct.
Any other questions on this item?
Cllr Liz McShane - 0:18:51
I've got one, or I've got a couple.
And given that the first time IFRS 16 has been implemented, I confident are we that
we've identified and valued correctly all the leases.
Jonathan Smith - 0:19:08
Thank you, Chair.
Effectively, I'm reiterating what I would have said, is that we did those reviews a
years ago and we've looked at again our assets, our leases and ensure that we have recorded
everything as we could do.
But again, the auditors will be able to verify that and they'll obviously have lots of knowledge
from other authorities but they're also doing these audits and being able to test whether
or not we have accounts broken correctly which we believe we have done.
Cllr Liz McShane - 0:19:39
On the timetable completion date is December 25.
That's quite ambitious, but it's obviously good that we're aiming for that.
Are there any risks that could delay that?
I don't want to be negative, but just push any little flips ahead.
Thank you, Chair.
SPEAKER - 0:19:54
So one of the things in terms of the work that we've done to date for the 2024 -25 audit
is we've done an interim week of work.
So rather than wait until the start of the audit in October,
the team has been in to look at some transaction listings,
to look at the trial balance, to do some reconciliations,
to select samples.
So that is putting us on the forefront,
and it's going to mean that we can start in October
and hit the ground running doing the testing,
rather than spending a few weeks doing the reconciliation
process and selecting samples at that point.
So I think we're very much in a good position to get started on the work quickly.
And I was speaking to Jonathan and Alan this morning
just to say that it's a shame that I'm not doing this year's audit
because I feel like you're very well set up for a smooth audit
given everything that has taken place over the last two financial years.
I feel for you in that way
Cllr Liz McShane - 0:20:58
because you've had the difficult couple of years behind.
Any other questions on this agenda item?
Councillor Godfrey.
Not a question.
Cllr David Godfrey - 0:21:11
It's just an observation where obviously November, December we're going to get some updates.
But so far I think it looks like a steady shift so I must congratulate all the officers
for getting us there at this stage.
And we shouldn't be worried about not having too many questions which we're quite pleased
actually.
That's all.
I'd just like to echo that as well.
Mr Walker.
Cllr Liz McShane - 0:21:32
I'd also like to echo that because I came with a newbie and thought well I don't have
Cllr Belinda Walker - 0:21:37
any questions this isn't good but actually as Polly said it's probably a good thing and
thank you to the officers for everything being so clear.
I've said something Councillor Wynne.
Cllr Liz McShane - 0:21:47
Cllr John Wing - 0:21:52
Only the same and thanks for the little bit of training beforehand that was really good
thank you.
I was a bit late.
Cllr Liz McShane - 0:21:55
Cllr Liz McShane - 0:22:01
So we go back to the recommendations for this agenda item, which are to receive a note of
the report, to note the progress of the 24 -25 audit and to consider the sector updates.
Could I have a proposer, please? Councillor Wing. And a seconder? Councillor Walker. And
can we vote to support the recommendations, to agree the recommendations? So that's unanimous.
Thank you.
And that's the last agenda item.
So we close the meeting.
Thank you everyone.