HA192 Annual Audit Letter - FINAL

Sabina-Patel

Description

audit 2003/2004 Annual Audit Letter Hatfield Town Council INSIDE THIS LETTER PAGES 2 - 4 • The purpose of this letter • Key messages • Accounts and governance • Looking forward • Closing remarks PAGES 5 - 7 Appendices • Appendix 1 – Audit reports issued • Appendix 2 - Scope of our audit • Appendix 3 - Audit fees Reference: HA192 Annual Audit Letter Date: December 2004 audit 2003/2004 ANNUAL AUDIT LETTER Action needed by the council The council should: The purpose of this letter • take forward the recommendations from our This is our annual audit letter for councillors for reports on your BVPP and final accounts; 2003/04, and is presented by the council’s and district auditor. The letter summarises the • continue its own programme of review of conclusions and significant issues arising from activities eg the Birchwood Centre. our recent audit of the council. We have issued separate reports during the year. These reports are listed at Appendix 1. Appendix 2 sets out the scope of our audit and Accounts and governance appendix 3 provides information about the fees charged. Best Value Performance Plan We have issued an unqualified opinion on your Best Value Performance Plan (BVPP). Key messages We have completed our work on the performance information (Best Value Performance Indicators) included in the BVPP Best Value Performance Plan and on the BVPP’s compliance with guidance. ...

Informations

• Publié par: Chion
• Nombre de lectures: 18
• Langue: English

Extrait

Reference:

HA192 Annual Audit Letter

Date:

December 2004

Annual Audit Letter

Hatfield Town Council

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The purpose of this letter

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Key messages

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Accounts and governance

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Looking forward

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Closing remarks

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Appendices

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Appendix 1 – Audit reports issued

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Appendix 2 - Scope of our audit

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Appendix 3 - Audit fees

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ANNUAL AUDIT LETTER

Annual Audit Letter – Audit 2003/2004

Hatfield Town Council – Page

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The purpose of this letter

This is our annual audit letter for councillors for

2003/04, and is presented by the council’s

district auditor. The letter summarises the

conclusions and significant issues arising from

our recent audit of the council.

We have issued separate reports during the

year. These reports are listed at Appendix 1.

Appendix 2 sets out the scope of our audit and

appendix 3 provides information about the fees

charged.

Key messages

Best Value Performance Plan

We have issued an unqualified opinion on your

Best Value Performance Plan.

Audit of 2003/04 accounts

We have given an unqualified audit opinion on

your financial statements.

Financial position

The council recorded a deficit of £78,000 in the

2003/04 year. This leaves a revenue account

balance of £27,000.

Other accounts and governance

issues

Your overall corporate governance arrangements

are satisfactory in most key areas. We have,

however, identified weaknesses that need to be

addressed in the areas of recruitment, bank

reconciliation, and contingency planning.

Appropriate recommendations have been made

in the final accounts memorandum.

Action needed by the council

The council should:

•

take forward the recommendations from our

reports on your BVPP and final accounts;

and

•

continue its own programme of review of

activities eg the Birchwood Centre.

Accounts and governance

Best Value Performance Plan

We have issued an unqualified opinion on your

Best Value Performance Plan (BVPP).

We have completed our work on the

performance information (Best Value

Performance Indicators) included in the BVPP

and on the BVPP’s compliance with guidance.

We have issued an unqualified opinion.

However, we have made recommendations that

will help the council improve the BVPP and its

associated processes.

Audit of 2003/04 accounts

We have given an unqualified opinion on your

financial statements.

This year the financial statements needed to

reflect the revaluation of the councils fixed

assets and the implementation of FRS17 in

relation to pension costs. Though problematical

these were properly reflected in the statements.

Councillors approved the annual accounts in

accordance with the statutory timetable. It

should be pointed out however that over the

next few years the deadline for completion of

the accounts will be brought forward in line with

the government’s requirements.

Financial standing

The council recorded a deficit of £78,000 in the

2003/04 year. This leaves a revenue account

balance of £27,000.

The council planned to use £63,000 of reserves

to meet its 2003/04 spending plans. Actual

outturn showed a use greater than this.

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ANNUAL AUDIT LETTER

Annual Audit Letter – Audit 2003/2004

Hatfield Town Council – Page

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The table below shows the level of reserves

available to the council at 31 March 2004

compared to previous years.

EXHIBIT 1

2004

2003

2002

Reserves

£27,200

£104,900

£68,500

The net pension fund liability as at

31 March 2004 is £153,000. The primary cause

of the change from an estimated net liability of

£252,000 at 31 March 2003 has been the

increase in the capital value of the fund’s

investment assets, arising from a rise in equity

markets from the low position during 2002/03.

It must be noted that liabilities will be

discharged as people retire in future years and

will be offset by future contributions.

It is also important to note that the transactions

now in the council’s accounts are neutral in their

effect on council tax.

Systems of internal financial

control

Your overall corporate governance arrangements

are satisfactory in most key areas. We have,

however, identified weaknesses that need to be

addressed in the areas of recruitment, bank

reconciliation, and contingency planning.

Appropriate recommendations have been made

in the final accounts memorandum.

The Town Clerk acts as the internal auditor.

There is no formal internal audit plan, however.

We have recommended that such a plan is

prepared.

We have made recommendations in respect of

other areas where processes and procedures

could be improved.

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Recruitment

; compliance with the Asylum

and Immigration Act criteria is an area

requiring attention.

•

Bank reconciliation

s; internal checks could be

strengthened by the Town Clerk reviewing

the Deputy Town Clerks work.

•

Disaster planning

; contingency actions

needing to be taken in the event of a disaster

need to be considered and documented.

Standards of financial conduct

and the prevention and detection

of fraud and corruption

We have not identified any significant

weaknesses in your arrangements to prevent

and detect fraud and corruption.

Looking forward

Future audit work

We have agreed an audit and inspection plan for

2004/05 and we have reported in this letter

those aspects that have already been

completed. The remaining elements of that plan,

including our audit of the 2004/05 accounts, will

be reported in next year’s annual audit letter.

We will be preparing our audit plan for 2005/06

by the end of March 2005 to ensure that, in

future, you are able to consider our audit plans

before the start of the financial year. We will

continue to ensure that our work is risk-based

and relates to the improvement priorities of the

council, wherever possible, when planning that

work.

Revision to the Code of Audit

Practice

The Audit Commission has consulted on a

revised Code of Audit Practice for application to

the audit of the 2005/06 accounts. The new

code, which will be laid before parliament in

January 2005, is designed to secure:

•

a more streamlined audit, which is

proportionate to risk and targeted on areas

where auditors have most to contribute to

improvement;

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a stronger emphasis on value for money,

focusing on corporate performance and

financial management arrangements (rather

than individual services and functions); and

•

better and clearer reporting of the results of

audits.

Further details will be provided in the audit and

inspection plan 2005/06.

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ANNUAL AUDIT LETTER

Annual Audit Letter – Audit 2003/2004

Hatfield Town Council – Page

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Closing remarks

This letter has been

discussed and agreed with

Peter Clark and Paul Widdicombe. A copy of the

letter was presented at the resources committee

on 8 December 2004.

The council has taken a positive and

constructive approach to our audit and I would

like to take this opportunity to express my

appreciation for the council’s assistance and

co-operation.

Availability of this letter

This letter will be published on the Audit

Commission’s website at

www.audit-commission.gov.uk

, and also on the

council’s website.

Rob Murray

District Auditor

8 December 2004

Status of our reports to the

council

Our annual audit and inspection letter is

prepared in the context of the statement of

responsibilities of auditors and audited bodies

issued by the Audit Commission. Annual audit

and inspection letters are prepared by

appointed auditors and addressed to

councillors and officers. They are prepared for

the sole use of the audited and inspected body,

and no responsibility is taken by the Audit

Commission or its appointed auditors to any

member or officer in their individual capacity,

or to any third party.

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APPENDICES

Annual Audit Letter – Audit 2003/2004

Hatfield Town Council – Page

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Audit reports issued

Report

Date issued

Audit Plan

July 2003

BVPP Report

November 2004

Final Accounts Memorandum

December 2004

Annual Audit Letter

December 2004

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APPENDICES

Annual Audit Letter – Audit 2003/2004

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Scope of our audit

Our main objective as your appointed auditor is to plan and carry out an audit that meets

the requirements of the code of audit practice. We adopt a risk-based approach to planning

our audit, and our audit work has focused on your significant financial and operational risks

that are relevant to our audit responsibilities.

Central to our audit are your corporate governance arrangements. Our audit is then

structured around the three elements of our responsibilities as set out in the code and shown

below.

THE THREE MAIN ELEMENTS OF OUR AUDIT OBJECTIVES

Accounts

•

Opinion.

Financial aspects of corporate governance

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Financial standing.

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Systems of internal financial control.

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Standards of financial conduct and the prevention and detection of fraud and corruption.

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Legality of transactions.

Performance management

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Use of resources.

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Performance information.

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Best Value Performance Plan.

The Audit Commission has circulated to all audited bodies a statement that summarises the

key responsibilities of auditors. Our audit has been conducted in accordance with the

principles set out in that statement. What we say about the results of our audit should be

viewed in the context of that more formal background.

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APPENDICES

Annual Audit Letter – Audit 2003/2004

Hatfield Town Council – Page

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Audit fee

Audit fee update

Audit area

Plan 2003/04

Actual 2003/04

Accounts

£3,400

£3,400

Financial aspects of corporate governance

£800

£800

Performance

£4,500

£4,500

TOTAL CODE OF AUDIT PRACTICE FEE

£8,700

£8,700