Auditors criticise York Council

Usually the arrival of the annual auditors report at a York Council meeting produces little excitement (or even mild interest).

Things may be a little different at a governance meeting which is scheduled to take place on 31st March.

While the Councils auditors Mazers give a generally positive view of the Council’s financial arrangements, they do take a pop at the process used to compensate the Councils last Chief Executive when she left the authority, quite suddenly, in 2019.

click image to access the full report

The Council has issued the following comments;

City of York Council has published its 2019/20 final accounts, which will be considered by the Council’s Audit and Governance Committee later this month.

The council’s accounts are subject to external audit by Mazars LLP, who previously highlighted four outstanding areas at the Audit and Governance Committee meeting in November 2020 that required final approval:

  • The heritage assets valuation where information has now been provided by York Museums Trust but was delayed due to the impact of Covid-19. Mazars have made a control recommendation in respect of the arrangements to review, challenge and document the output of valuation experts.
  • The council’s pension fund administrators, North Yorkshire Pension Fund, are unable to confirm pension figures in the accounts. This issue is not specific to City of York Council and affects all local authority members of the pension fund. Mazars have discussed future arrangements with the council to put arrangements in place for a full valuation in 2020/21.
  • Additional information regarding remuneration packages from the council is currently being worked through by Mazars. Mazars concluded that the sums involved do not present a risk of material misstatement.  Additional information regarding remuneration packages is ongoing and will be published when completed.
  • The audit of the ‘Whole of Government Accounts (WGA)’ return has yet to be completed due to a delays in receiving guidance from the National Audit Office.

Mazars LLP have now completed the majority of this work and provided the council with an updated Audit Completion report, together with a final version of the Accounts published in advance of the next meeting of Audit and Governance for information. 

Mazars identified there are no matters arising on the management override of controls or from work on revenue recognition.  Mazars have not identified any material errors or uncertainties in the financial statements or highlighted any indication of material estimation error in respect of defined benefit liability valuation. 

Responding the publication of final accounts, Debbie Mitchell, Chief Finance Officer, said:

Despite the impact of the pandemic, the Council was still able to complete and deliver draft accounts to the external auditor by the end of June 2020, a full month ahead of the statutory deadline. 

“Following detailed assessment of four areas identified by the auditors as requiring further work, Mazars have not identified any material errors in the financial statements and have indicated that the accounts give a true and fair view of the financial position of the council and that they have been properly prepared.

“Further work is taking place to provide additional information regarding remuneration packages and when this work is completed, it will be published and shared with the Audit and Governance Committee.  This does mean that the final audit certificate cannot yet be issued.  However, the auditor has made clear that this objection does not have a material impact on the financial statements. 

“We welcome the feedback from the external auditor and fully recognise that there are areas for improvement. We look forward working with Mazars to develop an appropriate action plan once this outstanding matter is published.” 

Audit report raises concerns about York Council data security

A report due to be considered by a Council committee next week reveals continuing concerns about the security of personal data held by the Council.

The auditor says,

“Whilst good progress continues to be made (on Information Security & GDPR) , further improvements are required to ensure compliance with the council’s policies for handling and storing personal and confidential information. There are also a number of issues still outstanding, relating to actions agreed in July 2019, following a GDPR readiness audit. These actions relate to policies, guidance, contract clauses; the information asset register; privacy notices; mandatory data protection training; management information on data security incidents”.

No further details are provided and the level of vulnerability of Council customers to data breaches is not explored.

On the impact of Coronavirus on the Councils activities the auditor is similarly vague. He says,

“This opinion is however qualified, in light of the current coronavirus pandemic and the impact of this on the council. The opinion is based on internal audit work undertaken, and substantially completed, prior to emergency measures being implemented as a result of the pandemic.

These measures have resulted in a significant level of strain being placed on normal procedures and control arrangements. The level of impact is also changing as the situation develops.

 It is therefore not possible to quantify the additional risk arising from the current short term measures or the overall impact on the framework of governance, risk management and control”.

NB. Another report, to the same meeting, claims to address the impact of the health crisis on the Councils activities. Unfortunately, it adds little to what has already been published and singularly fails to quantify the exposure that the Councils projects and revenue finance actually face.

City of York Council’s Statement of Accounts

City of York Council will open its unaudited accounts for public inspection from Wednesday 1 July to Tuesday 11th August.

The annual inspection gives members of the public and local government electors certain rights in the audit process.

Any person may inspect the accounts of the council for the year ended 31 March 2020 on the City of York Council website at https://www.york.gov.uk/StatementOfAccounts, and on reasonable notice, can request access to certain related documents (comprising books, deeds, contracts, bills, vouchers and receipts) or a printed copy of the accounts.

Application should be made initially to Debbie.Mitchell@york.gov.uk

The council’s accounts are subject to external audit by Mazars LLP. For the same period Wednesday 1st July to Tuesday 11th August electors can question the auditor about, or make objections to, the accounts before they are signed off by the Audit & Governance Committee on 14th September 2020.

Further details of the inspection process, elector rights and contact details can be found in the inspection notice on the council’s website at https://www.york.gov.uk/StatementOfAccounts

York “cold case” perpetrator finally named

Mr Redacted blamed for all Councils woes

Audit committee report April 2018

The long running saga, which started 4 years ago when the Council let consultancy contracts without going through a proper procurement process, is finally reaching its climax.

A report to a meeting next week gives an independent view of who did what and when at an audit committee meeting which discussed the issue a year ago.

Ironically that meeting descended into chaos when most members voted to discuss an internal audit report in public.  This caused a “walk out” by the Labour party committee chair.

The internal report was later leaked to the media causing more turmoil. The implicated “leakers” of the document (who denied the accusation) were later suspended from the Council’s Executive by the then Council Leader.  Hehimself was ejected from office a few weeks ago.

Apart from that, it has been a peaceful and harmonious 18 months at the York Council.

The report into the Audit meeting is heavily redacted. We can see no reason why the names of Councillors and officials should not be revealed WHERE THEY HAVE AGREED TO WAIVE ANY RIGHTS THAT THEY MAY HAVE TO ANONONIMITY.

After all, the meeting was web cast and is already in the public domain

It seems that the Council have not learned many lessons about transparency and accountability

Auditors slam York Council over contractor probe

Auditors have issued a critical report following complaints about how consultants were recruited during the term of the last Labour administration, which left office in May 2015..

The report will be discussed at a meeting taking place next week next week.

Officials involved in the scandal – and most of the Councillors that they reported to – are no longer with the Authority.

The audit report concerns how a consultant, who was employed in the public relations/culture activity area, was engaged.

The report concludes that there was no evidence of fraud but it says,

“Internal Audit undertook an investigation into the awarding of contracts to an external consultant. The investigation found that there was no evidence to show that written quotations had been received. A number of other breaches of the council’s Financial Regulations and Contract Procedures Rules were also identified including the absence of a signed contract, the failure to include the contract on the council’s contracts register, a payment in advance of the work being completed and inadequate contract monitoring”..

Part of the report is being withheld as it identifies the individuals involved in, what appears to amount to a case of maladministration 

Unfortunately the last Labour administration in York was mired in secrecy. Officials were given too much power and they seem to have exploited this to allocate work to their chums.

A copy of the external Auditors report can be found by clicking here

More recently there has been criticism of the present Council for allocating contracts for work on social care projects with little openness and even less regard for the rights of taxpayers 

The Council will be asked to consider what more can be done to prevent corruption in the future

Auditors lifting veil on City of York Council

Problems revealed with project management and registering interests

Although the now notorious audit report on irregular staff payments is not on the agenda for the York Councils next Audit committee meeting, several other issues are.

click to view

click to view

The Councils auditors (Mazers) annual report does conclude that group accounts for “City of York Trading” and “Make it York” are not required.  The publication of separate accounts would make it easier for taxpayers to understand the level of any cross subsidy enjoyed by these organisations.

The Auditors do say, “In all entities, management at various levels is in a unique position to perpetrate fraud because of the ability to manipulate accounting records and prepare fraudulent financial statements by overriding controls that otherwise appear to be operating effectively. Due to the unpredictable way in which such override could occur, we consider there to be a risk of material misstatement due to fraud and thus a significant risk on all audits”.

They go on to conclude, “There have been some high profile examples of problems with project delivery, such as the housing for older people procurement and more recently with the community stadium project. This has been the first year of operation of the Better Care Fund, which requires the Council to work with the local CCG and the wider health economy to reduce demand for acute healthcare. Any failures in these areas could compound the Council’s financial and operational difficulties and impact adversely on services provided”.

The Auditors are understood to be looking carefully at failings in the management of the Community Stadium project and the collapse of the older persons accommodation strategy (both of which date from the time of the Labour administration in the City)

The background papers published yesterday list some individual areas which are being audited.Audit report April 2016

These include Project Management, Register of Interests and s117 of the Mental Health Act.  Draft reports on these issues reveal only “limited assurance” – meaning there are significant issues to be addressed. The reports are in draft form only and are being review internally at this stage. All are potential matters of public interest (S117 of the Mental Health Act requires authorities to provide community support for people leaving hospital).

Reports already issued reveal that several departments have not agreed performance standards with the Councils reception (business support) unit.  Two years seems a long time to wait for the Council to publish target times (and performance) for dealing with issues raises electronically. Recently reports of fly tipping took nearly two weeks to be passed on to the team responsible for actually tidying up some dumping.

Similarly, the auditors did find some sensitive information in offices when they did a security sweep.

Most of the Audit reports – and particularly those of schools – have however found procedures to be generally satisfactory

Mazars are charging the Council £138,000 for their work.

NB. The Councils Executive has so far failed to clarify what issues will be discussed at its 24th April meeting when the Public Interest Report on irregular staff payments is on the agenda.

Auditors probe York Council parking discounts

It appears that officials at the York Council have been selling parking spaces at a discount to some local hoteliers.

2015 off street parking charges click

2015 off street parking charges click

Several hotels don’t have their own parking spaces and direct guests to Council car parks. It appears that they may have been sold scratch cards (which entitle the holder to park for 24 hours) at a rate below commercial levels.

A report, considered by a Council official on Thursday, suggests that the discounts had not be formally authorised and auditors have now been called in to assess the level of any loss.

A temporary replacement scheme is being introduced which will reflect the current commercial 24-hour parking rates (£12 per day). The new scratch card will not be available for short stay (premium) car parks like Castle and Esplanade.

Season ticket parking charges 2015 click

Season ticket parking charges 2015 click

The Council says that it will ask the responsible Executive member to consider whether a more commercially viable offer can be made to hoteliers. The Council is next due to revise its car parking charges in February.

It is not known how much the unauthorised discount on scratch cards has cost taxpayers.

Scratch cards are sometimes used by Council officials and have promoted some Freedom of Information enquires in the past. Here and here

Respark charges 2915 click

Respark charges 2015 click

An annual contract parking season ticket at the Foss Bank car park currently costs £770.

The Councils web site gives details of the Visitor Permit System (click). Visitor permits – restricted to Respark zones – come in books of 5, each book costs £5.50. Local residents may buy a maximum of 6 books per calendar month and 40 books in a year.

Details of Guest House permits costs can be found by clicking here

Departee’d but not forgotten

Following a £185,000 loss on the Grand Departy last year, the Council is now offering apprenticeships in "event management"

Grand Departee

How the York Council managed to lose £187,000 on the infamous “Grand Departee” concert staged in July 2014.

An independent audit has revealed the true level of the confusion and poor decision taking which surrounded the Grand Departee concert held at Monks Cross in July 2014

Although tAudit quote 1acked onto the TdF cycle race, the concert was in effect a stand-alone event.

The auditor’s report says that there was little documentary evidence to help their enquiry and many of the officers and members involved had subsequently left the Authority.

Most of the blame for the shambles is placed at the door of the last – Labour dominated –  “Cabinet”.

“It is concerning that officers were expected to undertake inherently risky commercial activity without a formal member decision”.

Although it has been estimated that the TdF injected £8.3 million into the local economy, little of this directly benefited taxpayers who picked up a total bill for £1.8 million.Audit quote 2

We pointed out at the time that the event was heading for a financial disaster

 It remains unclear why the Council failed to cut its losseson the event when it became clear that ticket sales were derisory.

So have the lessons been learnt?

TAudit quote 3he principle of open decision making with properly costed and monitored plans is probably the most important.

Perhaps the nearest current project with similar variables is the plan to establish a “Community Stadium” in the City. This also has grown like topsie with an initial zero taxpayer’s subsidy (other than the stadium site land) having grown to £8 million.

The inclusion of an additional swimming pool, which will in effect be in competition with the Yearsley pool, suggests that not all lessons have yet been embedded in Council thinking

More York Council Audit reports published

Waterworld subsidy among those to be investigated further.

Waterworld - closed by the York Council last Novemebr

Waterworld – closed by the York Council last November

The subsidy requested by Waterworld contractor Greenwich Leisure is among a number of reports published today

The auditors brief is described as;

, “Greenwich Leisure Limited (GLL) ran the Waterworld leisure centre on behalf of the council before it was demolished as part of the larger project to build a new community stadium. Each month GLL submitted monthly accounts which showed both the income and expenditure for Waterworld with the council re-imbursing GLL for the losses incurred during the month. This agreement lasted between April and November 2014 until Waterworld closed.

The purpose of the audit was to confirm the council is paying the correct amount of money to GLL although there were no concerns that the figures paid to GLL were not representative of the costs of providing Waterworld. The audit reviewed the following areas:

  • A sample of large value invoices in order to confirm that expenditure related to Waterworld, the period in question, the amount was correct and the invoice had been authorised.
  • The cashing up process in order to confirm that all income was banked in full.
  • The monthly transaction sheets sent by GLL to support the subsidy payments made by the council were accurate, complete and had been reviewed by staff at the council”.

Greenwich are involved in the contract for the new Community Stadium.

A full list of audits completed is (click to view):-

York Council accounts still not certified

Failed

The Councils Auditors have still not certified completion of the York Councils accounts for 2013/14.

The accounts attracted alot of comment when the auditors came to the conclusion “that the Council had proper arrangements in place to secure economy, efficiency and effectiveness in its use of resources, except for weaknesses in budgetary control and financial management in Adult Social Care services”

While taxpayers have been told that action is being taken on that issue, it now emerges that Mazars cannot close the file on last year’s activities because of an outstanding objection from a taxpayer about the Lendal Bridge fine issue.

The concern may be addressed if the Council agrees – as expected – a general refund of fines collected on Lendal Bridge when it meets on 11th December 2014.

In the meantime a report from Mazars is due to be considered by the Councils audit committee on 10th December