Agenda item

External Auditor's Annual Audit Report 2021/22 - Warwickshire Pension Fund Management Response and Action Plan

This report sets out the final 2021/22 Audit Findings report and asks the committee to consider the management response to the recommendations therein.


The Committee received a report which asked Members to consider the management response to the recommendations in the external auditors report along with the final 2021/22 Audit Findings report.


The Chair invited Grant Thornton’s representative, Avtar Sohal, to speak to the report and he advised that there were no changes from the original report.


Chris Norton, Strategy & Commissioning Manager (Treasury, Pensions, Audit, Risk & Insurance), introduced the report and highlighted the management response to the original recommendations, attached at Appendix 2.


Councillor Gifford raised a query relating to the IT General Controls and Journals Review and Approval entry.  In response, Chris Norton explained that having the correct IT was key but had to work alongside the controls that officers exercised over journals, processes and IT together.


Virginia Rennie addressed a subsequent query relating to the move to a cloud-based solution and whether this would change any processes.   Virginia explained that the move was planned for the Autumn, and whilst it would change some processes, officers were very mindful of the need to ensure that the authorisation of journals remained robust.  She assured the Committee that a member of the Internal Audit team was involved in the project planning and would be keeping an eye on progress.


Councillor Feeney asked if there was ongoing dialogue between WCC’s IT department and Grant Thornton’s IT team in relation to the IT General Controls management response.  Avtar Sohal advised that good communication between all parties was a key part of the process.


Avtar Sohal assured the meeting that there had been no incidents of override found nor failures in the journals process but it was the Auditor’s role to look at potential weaknesses.


In response to a query from Robert Zara, Avtar Sohal explained that the reference to ‘a UK sleeve’ mentioned in the Audit Adjustments section was a technical term relating to equity funds.


In relation to the Pension Fund, the Chair queried how well funded the scheme was compared to other authorities but noted that Members recognised it as a very good scheme.  The potential impacts of interest rate fluctuations were discussed and Members were assured that these issues were looked at in detail and monitored by the Pension Fund Investment Sub-Committee.


The importance of ongoing dialogue with all employers who were part of the scheme was noted along with the requirement to keep volatility low to protect taxpayers’ money.  It was explained that the scheme was made up of many employers, including for example the five District and Borough Councils and the Police amongst others and, therefore, there was a long-term strategy for managing it.


Councillor Hammersley asked for clarification on the ‘Financial Statements – Significant Risks’ section of Appendix A and was advised that the differences referred to were as a result of the time taken to receive information from fund managers between the first draft and the final version.


Councillor Feeney expressed her gratitude to Chris Norton and his team for good management of the Council’s investments.


Having considered the report and having heard from the officers present, the Committee


Resolved that


1)    the final 2021/22 Audit Findings report attached at Appendix A, is noted; and

2)    the management response to the recommendations in the external auditors reports as set out in Appendix B, is noted.

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