Following the publication of the draft 2021/22 Statement of Accounts (including Pension Fund) the report provides an update on the audit status for each year of open unaudited accounts for the three financial years 2019/20, 2020/21, and 2021/22.
Members of the Committee welcomed the representatives of the Council’s External Auditors, BDO, Lisa Blake and David Eagles, who had attended the meeting together with officers, to provide an update on the unaudited accounts for the three financial years 2019/20, 2020/21, and 2021/22.
Officers provided an update on the audit status for each year of open unaudited accounts for the three financial years 2019/20, 2020/21, and 2021/22 (including Pension Fund) together with a position statement with regards to the situation with the Council’s external auditor, BDO.
At the invitation of the Chair and for the benefit of the committee, the BDO representatives gave additional context to the previous two and a half years, summarised the current position and explained their plan to ensure that the unaudited accounts were signed off.
The Committee noted the reasons why the accounts for the last three years had not been signed-off and the events leading up to the current position.
Members of the committee expressed their dissatisfaction with the overall performance of BDO, which was considered to be totally unacceptable, and BDO’s inability to progress sign-off of the accounts as stipulated in the current contract. Members insisted that BDO provide a clear timetable and end-date as to when the accounts would be signed off, barring the sector-wide infrastructure assets issue which had been fully explained to the committee in reports at previous meetings. Members noted that it was hoped the infrastructure issue would be concluded before the end of the 2022 calendar year or very early in the new year.
Members were deeply concerned regarding the reputational risks to the Council. Members could not understand why there was a further delay when BDO had indicated that they hoped that an audited set of accounts, infrastructure assets aside, would be brought to the committee meeting. Members also expressed their dissatisfaction with the contractual arrangements with the Public Sector Audit Appointments Limited (PSAA), which allowed for continual shift and prevented the sign-off of the accounts.
Officers reported that all the information necessary for the audit to continue through the due process had been supplied to BDO and Council staff were on standby and ready to respond to any further requests for information from BDO. It appeared to members that there were problems being experienced by BDO in providing sufficient resource to continue with the audit and that BDO appeared to prioritise audits for other organisations, namely the NHS, over and above Enfield.
The representatives from BDO explained that it had been very difficult to reschedule the work due to the resources available, although some additional resource had been supplied by BDO. The representative also confirmed that BDO would not be paid until the audits were complete. The Audit Partner, David Eagles, responsible for the 2019/20 audit, explained that he was booked in on 1 November 2022 to work on Enfield’s 2019/20 audit, and hoped that 2019/20 accounts audit would be finalised, infrastructure assets aside, for the next GPC meeting on 1 December 2022. Lisa Blake, responsible for 2020/21 accounts, explained that she had a team booked to re-commence audit of the 2020/21 accounts from November, but that this was dependent on the 2019/20 audit being finalised.
Members requested that the representatives attend every meeting, either in person or, virtually, should personal attendance not be possible for any reason, until at the accounts for which BDO are signed-off.
Officers advised that going forward there would be a more robust contract in place than that which was in place with BDO.
2. The current accumulated backlog of three financial years 2019/20, 2020/21, and 2021/22 of unaudited statement of accounts be noted;
3. It be noted that, the audit of the 2019/20 statement of accounts, barring the sector-wide infrastructure assets issue, had not been finalised as expected, but that BDO hoped to have the audit finalised (infrastructure assets aside) for the next GPC meeting on 1 December 2022; and
4. Representatives of the Council’s external auditor, BDO should attend every subsequent meeting, either in person or virtually, until all the audited accounts for the three financial years 2019/20, 2020/21, and 2021/22 of unaudited statement of accounts had been signed off.