Issue - meetings

A report by KPMG outlining the outcomes of the interim audit of the Wiltshire Pension Fund ahead of the full audit of the 2010-11 accounts.

The Chairman introduced Mr Chris Wilson and Mrs Gemma Broom of auditors KPMG, who updated the committee on the key findings found within the interim audit report for 2010-11.

Chris Wilson highlighted the high importance of two changes during the 2010-11 financial year: these were the implementation of the Altair system and the changes due to the adoption of the new International Financial Reporting Standards (IFRS).

Work was continuing to improve the accounts production process, and it was explained that KPMG works in liaison with the Pension Fund’s finance team and Wiltshire Council’s internal Audit team, to avoid duplication and maximise effectiveness. It was clarified that KPMG were content that draft accounts were being prepared under the requisite levels to ensure full disclosure.

Key audit risks were:

• IFRS conversion process
• Valuation of investment assets
• Implementation of Altair

The audit fee for the 2010/11 audit is £45,450 (2009/10 was £46,950) and is calculated in reference to a number of factors set by the Audit Commission along with KPMG’s assessment of audit risk and control environment.

Gemma Broom then gave an update on the work in progress at Wiltshire. Organisational controls are good; work on assessing IT controls was in progress and comments on this would be included in the final audit report in September. Regarding financial controls there were two minor deficiencies, namely that evidence of the independent review of the bank reconciliation process was not being performed, and there was no review of the manual journals evident.

These points were discussed, and officers explained that verifications of the reconciliations were of course happening, and work was underway to establish a transparent and reliable digital method of recording these and the other review processes undertaken by Pension Fund staff.

Chris Wilson explained that any further work resulting from these issues would not involve significant extra work or impact on the fees due to KPMG.

Bob Summers, the Independent Financial Adviser to the fund added that CIPFA were monitoring the implementation of the IFRS across funds, and would strive for consistency of approach.

Membership details appeared to now be fully in order, and following a final check in July, Gemma Broom confirmed this audit action point should be cleared in the next report.

The interim Chief Finance Officer also confirmed that a full 10 day review of the Altair system was a component of the general Audit work plan, to be approved at the Audit meeting of 13 May.

Resolved:

To note the interim Audit report.