Issue - meetings

To receive and consider the Warwickshire Pension Fund External Auditor's Governance Report.

The Committee received a report from the Council’s External Auditors, Grant Thornton which reported on issues arising from the audit of the Warwickshire Pension Fund financial statements before issuing their final opinion.

The report highlighted that the External Auditors required written confirmation about the fairness of various elements of the financial statements, known as the “Letter of Representation”.  The Committee were asked to approve the wording of the letter, attached as Appendix 2 to the report, subject to any necessary changes.

Avtar Sohal introduced the report and highlighted the minor mislabelling of the report, which should be the External Audit Report on the Pension Fund Financial Statements.  He signposted Members to the Headlines of the report which advised that the work was substantially complete, with no matters requiring modification.    The report went on to detail three outstanding matters: receipt of the management representation letter, review of the Annual report for consistency with the audited financial statements and review of the final set of financial statements.

Following a question from the Chair, there was not a cap on Level 3 investments, but the pension fund set targets, with allocations to different asset types.

Councillor Gifford queried the reference to management override of controls and noted that there was no evidence of misuse.  He therefore queried whether this was a computer system issue.  In response, Rob Powell advised that this was a standard audit test for all entities and went beyond computer systems. This related to override of standard controls and was not specific to Warwickshire.

Jim McLarnon provided further assurance that no instances of management override of controls had been identified and the auditors were comfortable that there were other robust, compensatory measures in place to mitigate any risk.  Jim McLarnon went on to highlight the work that the IT Audit team had undertaken, with many of the points raised having already been remedied and addressed by management.  He concluded by stating that there was nothing else to draw Members’ attention to other than the information with regard to fees and independence, with additional appendices at the back of report.

In response to a question from the Chair, officers confirmed that KPMG were the auditors used by Border to Coast Pensions Partnership and Grant Thornton only had minimal contact with them.

Members noted the Letter of Representation along with the appendix detailing the unadjusted misstatements.

Having received no questions from the Committee, it was

Resolved that

1)    the Audit Findings Report of the External Auditors for the Warwickshire Pension Fund, attached at Appendix 1, is endorsed; and

2)    the wording of the Letter of Representation, attached at Appendix 2 to the report, is approved, subject to any changes which may be necessary to the final draft.