“It doesn’t look good” admits Chief Officer as Blaenau Gwent Council 21/22 accounts are still not signed off

BLAENAU GWENT council’s accounts for 2021/22 have still not been signed off due to problems found by auditors. ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

At a meeting of County Borough Council’s Governance and Audit committee on Wednesday, July 12, councillors and lay members were told there would be another delay in the sign-off process for the accounts. ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

Resources chief officer, Rhian Hayden explained that it had been expected that the council would have been able to provide the accounts as well as an Audit Wales ISA 260 report – which would detail all the issues that cropped up in the process – to the committee meeting. ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

But there have been delays from Audit Wales side in producing the ISA 260 report. ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

Ms Hayden said: “We’ve presented our report but given the committee the option of deferring the decision until the Audit Wales ISA 260 report and their opinion are available – which we hope is in the next couple of weeks.”
She advised the committee to wait and see the ISA 260 report before signing off the accounts. ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

Mike Jones of Audit Wales said: “It’s on us it’s our delay.” ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

Mr Jones explained that when Audit Wales proposes a “modified opinion” to accounts they have a quality assurance process and ask an engagement lead director not connected with the audit to check whether their conclusions are “reasonable.”
The director earmarked for the task was unable to do the work.
Mr Jones said: “It was unavoidable.
“We have had to make alternative arrangements which has delayed the process for two or three weeks – unfortunately we missed this committee’s deadline.” ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

Cllr Wayne Hodgins said: “If we do defer will we be in breach of anything from Welsh Government or Audit Wales – are we still in compliance of timeline.” ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

Ms Hayden said: “Non-agreement of our accounts is regrettable, we are where we are.
“It doesn’t look good and we’ve already reported that we haven’t published either our draft or final accounts within the legislative timescales but it won’t have any significant impact other than reputational.” ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

Cllr Hodgins said: “It’s good to hear, as in these times we can’t afford any fines or penalties.”
The committee agreed to defer accepting the accounts. ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

The council’s draft statement of accounts was reported to the committee in November.
The main reason for delay is related to the significant issue identified by Audit Wales in their report on the audit of accounts going back to 2020/2021. ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

This explained the need to correct the errors identified in the council’s fixed asset register and historic cost records that resulted in misstatement of the capital adjustment account and revaluation reserve. ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

A number of adjustments have been identified and these need to be reported to the committee first before approval of the final accounts.
A problem identified by Audit Wales is that the council failed in the past to regularly review the Estimated Useful Life (EUL) of assets. ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

By BBC LDRS ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​