To receive and consider the:
· 2022 Audit Plan for Powys County Council; and
· 2022 Audit Plan for the Powys Pension Fund
Minutes:
· 2022 Audit Plan for Powys County Council
· 2022 Audit Plan for the Powys Pension Fund
Issues Discussed:
· Powys County Council Accounts – Areas of risk highlighted for the audit work:
· Management Override – this is an issue for all organisations both public and private.
· Asset valuations – this risk does not relate to Powys alone but an aspect being considered across all bodies including sponsored bodies and the NHS.
· Related parties information – some weaknesses have been identified in the previous process of recording related party information.
· GCRE – the position as currently understood is being reported.
· Many risks are similar across local authorities.
· One specific piece of work for Powys is revisiting the improvement in scrutiny.
· Work across Wales – ongoing risk and assurance work.
· Thematic reviews to be undertaken – unscheduled care, digital.
· Page 80 – one potential conflict of interest for a member of the Audit Wales Team, and the safeguards in place was brought to the attention of the Committee.
· Powys Pension Fund – the Audit Wales work on the fund will not commence until October / November but bearing in mind the statutory deadline of 30th November.
· Questions:
Question |
Response |
Does Audit Wales have sufficient resource to meet the timescales. |
Yes we are content with the level of resources available to undertake the work. Audit Wales propose to complete its work on the financial statements and provide an opinion by the end of October this year.
As a result of Covid, Welsh Government has provided extended deadlines for the final audits of accounts. The extended deadline is for audits to be completed by end of November 2022. Audit Wales is working to an internal deadline with a view to having all statutory accounts signed off by end of October. In relation to Powys, work has already commenced on the financial statements. If possible would like statement of accounts being presented to the Committee by the end of September or if not by mid October. |
In relation to the Well-Being objectives of the Council and the background of the Well-Being and Future Generations Act. Powys has a Public Service Board and the well-being objectives are about joint working. How can the auditors reconcile the Council’s accounts where there are part of joint working exercises. |
Audit Wales is trying to work with and alongside Councils in Wales and across all public services to have sight of what decisions taken today will affect services in the future. This will be looked at across all public services in Wales not just Councils. There will be a specific piece of work about how the Council is setting its well-being objectives and also how this happens across public services as well including common themes.
In terms of partnership working the Chief Executive advised that Audit Wales has started to meet jointly with the Council and Ceredigion about joint working arrangements within the Corporate Joint Committee (CJC) framework. This provides the possibility of looking at the Mid Wales Growth Deal, strategic transport and planning in future. Audit Wales has been asked to focus on the development of CJCs initially across Wales. Another potential area of joint audit work is the North Powys Well-Being Programme. |
Who pays the fee for the pension fund, is it the Council or the pension fund |
That comes from the pension fund. |
Are there any non directly employed individuals in the fund and what are the risks associated with that. |
There are admitted bodies to the pension fund.
There are a number of other bodies participating in the pension fund and there are various arrangements with those bodies around the level of risk. Some have risk sharing agreements with the Council other have bonds in place to offset that risk. The position of admitted bodies is regularly monitored. |
To what extent is the current debate around the nature of investments, ethical investments, divestments, from a purely financial position how much is this a risk to the financial management of the fund. |
It is for the Pension Fund to determine where they invest their money. The fund has an investment strategy and a responsible investment policy which will determine the type and nature of investments. Investment decisions consider both and it is the Committee advised by fund managers who make these decisions.
The Pension Board provide an independent opinion on the Governance arrangements for the fund, including risk management.
Pension funds views’ across the UK as well as Government is that bodies should not be investing in bodies supporting Russia. There is some exposure from the pooled investment fund but the percentage overall is minimal.
|
Over the last few years the pension investment consortium has used hedge funds and other financial instruments to defray risk. To what extent does Audit Wales look at the level of risk with this type of activity. |
This is not considered to any extent in terms of the audit of the Powys pension fund as the audit of pooled fund is undertaken by other auditors and Audit Wales would liaise with those auditors in terms of assurance. Audit Wales do not look at the decisions taken but look at the results and would raise any concerns about the nature of transactions.
In terms of an opinion on the pension fund Audit Wales would not necessarily give a positive opinion of the fund but give a view of the financial statements themselves.
In terms of risk the pension fund has a risk register and our advisers advise the Committee about the ongoing level of risk and any changes to those risks. The independent Pensions Board also monitors the level of risk, advise in terms of reviewing arrangements and how that risk is being managed. |
Outcomes:
· Noted.
Supporting documents: