Annual letter from the Auditor

Report: 11
Date: 17 January 2002
By: Treasurer and Clerk

Summary

The annual letter has been received from the District Auditor in respect of the Authority’s 2000/01 accounts. The letter was considered by the Audit Panel at its meeting on 13 December who referred it to this Committee to consider policy implications. A follow-up action plan has been produced.

A. Recommendation

That the Committee considers the annual audit letter from the District Auditor and notes the proposed follow-up action plan.

B. Supporting information

1. The District Auditor has now completed his audit of the MPA’s accounts for the last financial year (2000/01) and has issued his annual audit letter.

2. At its meeting on 13 December the Audit Panel received the draft letter from the District Auditor. The final version of the letter was received subsequently and did not contain any material changes. A copy of the letter, which has already been circulated to all members of the Authority, is attached as Appendix 1 (see Supporting material). The MPA accounts were finally signed off as at 31 December 2001.

3. At the meeting of the Audit Panel the District Auditor said it was a creditable achievement for the Authority to have submitted its first accounts in a timely manner. He said that as discussed in his letter there were concerns about the financial standing of the Authority and explained that it had been necessary to qualify his opinion on the Accounts on two counts: (i) reservations about the lack of provisions for third party liabilities and (ii) the inadequacy of the reserve to meet police pensions liabilities.

4. The Audit Panel asked that the letter be referred to the Finance Planning and Best Value Committee to consider policy implications of the external auditor’s views.

5. The Treasurer has prepared a draft action plan picking up the relevant points in the letter (attached at Appendix 2,  see Supporting material). This is being shared with the District Auditor to ensure comprehensiveness. There is also a need to clarify with the auditor that the proposed actions are seen as an appropriate response to his concerns.

6. The action points earmarked for review by this Committee fall into two categories. Numbers 1, 3 and 6 relate to financial management and policies and financial reserves. Numbers 7, 8 and 9 refer to legal issues. These matters will be the subject of specific reports to future meetings.

7. The concern about the Authority’s financial position and the level of reserves is reflected in the Treasurer’s letter to the Chair of the MPA dated 2 January 2002 which has been circulated to all members of the Authority. The issue is picked up elsewhere on this agenda in both the report on the current year’s monitoring and the report on next year’s budget.

8. With regard to the closing remarks in the letter, the Committee is advised that the letter was published on receipt, copies of the letter are available to the public and it has been placed on the MPA website.

9. Copies of the Auditor’s letter have been sent to all members of the Authority.

10.. The Committee is asked to consider the letter and note the proposed follow up action plan.

C. Financial implications

There are none arising directly from this report.

D. Background papers

None.

E. Contact details

Report authors: John Crompton, MPA

For information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

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