Report of the Assistant Director Resources/Treasurer

The Panel considered the report of the Assistant Director Resources/Treasurer (ADR/T) and the External Auditors Ernst & Young LLP(EY) presenting the external auditor’s updated planning report for the audit of the 2021/22 financial accounts and the external audit scale fee variation for the audit of the 2021/22 accounts.  EY had not identified any specific risks relating to the Authority’s accounts. 

In May 2022 EY notified the Authority of a proposed scale fee variation of £11,423 for the audit of the 2020/21 accounts.  However, it had not been clear at the time that it should also have included the scale fee rebasing figure of £27,553 included in the original planning document for 2020/21.  EY expects to submit a scale fee variation for the audit of the 2021/22 accounts in the range of £43,762 - £47,762 giving a total scale fee of £67,452 - £71,452. At this stage it does not appear that there are any material new responsibilities on external auditors resulting from the relevant Code and therefore if PSAA remains consistent in its approach in previous years then an approved scale fee variation of the order of £20,000 may be a more reasonable forecast, giving a total scale fee of approximately £43,690.  The increase exceeds the additional grant provided by Government however can be contained within the existing finance budget.

In response to the Redmond Review the Government amended the draft and final accounts publication deadlines for relevant bodies including Fire Authorities to 31 July and 30 November for the accounting year 2021/22.  The Service expects to publish its draft accounts in the week commencing 11 July 2022, later than planned as a result of delayed receipt of the collection fund information from billing authorities, requiring an additional Scrutiny & Audit Panel to be held on 28 September 2022 for approval.  It was likely that EY would not receive the assurances required from the auditor of the East Sussex Pension Fund (ESPF) until October.  If this was the case a further update and final audit report may need to be presented to the Panel on 10 November 2022. 

The Panel queried whether there was a communication issue between ESPF and EY.  The ADR/T explained that there had been two issues, one regarding communications between ESFRS and Barnet Waddingham, this had been raised previously with the Panel and a more structured approach had been introduced.  The second was a perennial issue between EY and the auditors o the ESPF, Grant Thornton.  EY confirmed that Grant Thornton were aiming to notify them of their opinion in October, with EY aiming to complete as much of their audit as possible before the Panel in September.  

Some members of the Panel repeated their unease at the size of the fee scale variation and whether there were any other options for auditors.  EY reminded the Panel that the Fire Authority had chosen to opt into the PSAA which meant that there were no other options available to them.  Whilst the fee may appear high, but in the  ...  view the full minutes text for item 7