Agenda item

Committee is asked to note the reasons for the delay in publishing the Statement of Accounts for 2025/26.

Terry Collier, Deputy Chief Executive and Altin Botzhani, Interim Deputy Chief Finance Officer, provided an update on the delay to publication of the 2025/26 Statement of Accounts. They advised that the delay related to complex accounting treatment within the Collection Fund and concerns regarding the reliability of information provided by an external specialist adviser.

It was explained that, following validation checks, concerns had been identified shortly before the statutory publication deadline. As a result, the Council had commissioned an independent specialist firm to undertake a detailed review of that part of the accounts to ensure they were accurate and robust before publication. It had been confirmed that the issue related to accounting treatment and reporting requirements rather than the collection of council tax or business rates, and there was no suggestion of fraud or financial irregularity. The Committee was advised that publication of the accounts was now expected by the end of August or early September, subject to completion of the specialist review and subsequent amendments.

Both officers acknowledged Councillors’ frustration with the delay but highlighted the significant improvements made to the accounts process compared with previous years. The Interim Deputy Chief Finance Officer also outlined a number of measures being introduced to strengthen future arrangements, including enhanced in-house expertise, more regular monitoring, monthly Collection Fund reviews and an expanded year-end ‘soft close’ process to identify issues earlier.

During discussion, members of the Committee expressed disappointment and concern that the issue had only been identified shortly before publication of the accounts, despite previous assurances to them regarding progress. Clarification was sought on the extent to which the external auditors had been informed of the emerging issue and whether the delay would result in additional audit costs. Officers advised that Grant Thornton had been kept informed and had supported the decision to delay publication in order to ensure the accuracy of the accounts. It was also confirmed that the revised timetable was not expected to affect the auditors' ability to report their findings to the Committee in November.

Concerns were raised about the implications of the delay for confidence in the Council's financial governance and preparedness ahead of transition to West Surrey Council. Officers acknowledged the validity of this but highlighted the significant improvements already made to the accounts process compared with previous years and advised that resolving the Collection Fund issue would strengthen the overall robustness of the accounts.

Questions were also raised regarding the management and oversight of the external specialist engaged to support Collection Fund accounting. Officers explained that regular monitoring arrangements had been in place but that concerns only became apparent once the final figures were received and validated. Members requested that the root causes of the issue and the lessons learned be reported once the specialist review had been completed.

Councillor Nichols questioned the specific content of the public notice issued to explain the delay in publication of the accounts. Officers agreed to review and update the notice in order to provide greater clarity regarding the reasons for the delay.

The Committee emphasised the importance of ensuring that appropriate controls, skills and monitoring arrangements were in place to prevent a recurrence. Members supported proposals to strengthen in-house expertise and requested ongoing assurance regarding progress.

It was also agreed that the Chair, Vice-Chair and Independent Member would meet with the external auditors ahead of the November Audit Committee meeting to discuss the matter further.

RESOLVED: That the reasons for the delay in publishing the Statement of Accounts for 2025/26 be noted.