end of year return/audit

Question

At a recent meeting my parish council voted to agree and sign the end of year audit and 'corresponding paper work'. The was not circulated or seen by cllrs before the vote. Indeed I over heard the clerk saying that the chairman still needed to fill in certain parts.

Several councillors thought that this was not the right way to do it but alas the majority thought otherwise.

Cllrs dismissed it as unimportant or simply said they trust the clerk to have done it right etc

 

Am I right to think that to have voted on this without seeing anything is ludicrous and the wrong way to do things?

 

Also after having done some reading I expected our auditor to have produced some sort of 'governance review', which checked the council had the right procedures in place etc, to make up part of the end of year return but there was nothing like this, we were told it was all just financial figures.

 

Any advice, comments and recommendations would be very welcome please!

Answer 1

Councils should take audit seriously.

There should ideally be controls within the council, typically by periodic councillor audits.

The council should appoint the internal auditor from available candidates on the basis of competence and cost.  The internal audit is the heart of the process.  The internal auditor should verify not only that transactions are correctly recorded, but also that they involve expenditures within the powers of the council, properly authorised by minuted decisions in council.  (Some routine matters may be justified by old decisions that remain effective for many years).

The council should review the internal auditor's report and also the whole of the annual return.  Usually, there will be a variances report that has been prepared by or for the clerk, and this should also be reviewed by the council.  The return contains declarations made by the council, and councillors ought to be clear what it is they are declaring that they have done.

The external audit is then determined largely on the reasonableness of the material submitted in the annual return, including the internal auditor's comments.  In exceptional cases, the external auditor will ask for more detailed information.