Agenda item

Members considered a report presenting the findings of an initial lessons learned review carried out by Finance officers following the 2017/18 accounts closedown.  It gave an assessment on the findings of the lessons learned review and the plans in place to implement for 2018/19 and the key risks to the closedown process for 2018/19.  A meeting had already taken place with Wales Audit Office (WAO) to discuss what needed to be put in place to meet the earlier closing deadline and which areas of the accounts could be audited early.

The Assistant Head of Finance informed Members that the lessons learned process was carried out annually after the statement of accounts.   This year there was greater importance due to the closing timetable coming forwards for draft accounts and audit for final accounts.

Whilst there was significant progress made again within 2017/18 there were still a number of improvements that needed to be made to ensure a better process and completion of accounts by an earlier closing deadline in the near future. 

2018/19 year end would be the first year where the final date on which the accounts must be signed and published would be brought forward from 30 June to 15 June with an audited statement completed 15 September.

Early discussions had taken place with Wales Audit Office, and a meeting had already taken place to discuss lessons learned with Finance Officers, as well as discussing work that could be undertaken early by both the Accountancy Teams and WAO to ensure that the revised deadline could be met.  

The opinion from the Independent Auditors report was that the accounts gave a true and fair view and had been properly prepared in accordance with the Code of Practice.  This was in relation to both the single entity accounts and group accounts.

The process for challenge and improvement for 2017/18 accounts closedown and financial statements had already begun.  Classification and coding of expenditure and income needed to be improved. Also improving the process in terms of efficiency in terms of the working audit with what can be done earlier. It built on what had been done in the last two years with Audit. The aim being to build on improvements each year.   The early work on provisions had gone well and a couple of capital items, disposals had been dealt with early. A timetable had been drawn up in terms of what needed to be done.

A review of certain provisions such as accumulated absence was undertaken by finance staff during early 2018 to enable WAO to review early prior to the end of the year.  Building on the work that was completed early, the same work was planned for early 2019.  All other provisions and lease reviews would be completed within the same timescales.

This review would be especially important in regards to leases due to the new IFRS 16 standard which replaced the earlier leasing standard IAS 17.  Whilst the new standard did not come into force until the 2019/20 financial year, IFRS 16 could lead to major changes in the way local authorities accounted for assets used under lease arrangements and the obligations under those leases.  Early review of leases would not only be important for 2018/19 year end, but would provide a solid foundation for the change to the new standard in 2019/20.  

Comments made included:-

·         The document could benefit from the sorts of questions that Audit Committee would ask. 

·         The style of narrative and quality of writing was not as good as it could be with a lot of tables.

·         It was noted that last year’s working paper was not the same as the published document. 

·         Given that the Audit Committee was being asked to sign off assessed on the style of the document and how well it looked with regards the quality of the review, the review of Draft 1 in June and the final accounts and Audit Committee picked up on a number of spelling and grammatical errors.  This raised questions in relation to the review process of the document.

·          In the timetable there was no mention of the Annual Governance Statement.  

Agreed:

To note the lessons learned process that had been carried out to date.