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Audit Committee minutes

Committee minutes · Audit Committee · Thu 2 Jul 2026 · Hastings Borough Council

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These are the minutes of the Audit Committee meeting held on 2 July 2026. p1

The Committee approved the 2025/26 Annual Governance Statement for publication alongside the Statement of Accounts. p6

The Committee noted the Chair's report on the Committee's effectiveness during 2025/26. p5

The Committee noted the Grant Thornton External Audit Plan for 2025/26, which set a proposed audit fee of £173,397. p7

The Committee noted progress on external audit recommendations, including that 42% of actions had been completed and 58% were in progress when the report was prepared. p8

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  • p1Audit Committee — minutes of the meeting on 02/07/2026
  • p513. Audit Committee Chair's Report The Chair guided the Committee’s reflection on its effectiveness during 2025/26, particularly in relation to Hastings Housing Company and associated areas of risk. The Chair cautioned that quorate meetings had proven challenging, resulting in some meetings having to be postponed. Members were reminded of the importance of attendance and of arranging substitutes where necessary. Cllr Webb commented that the Committee’s role in senior officer performance management had not been fully discharged in recent years and consequently the Committee discussed the need to review its Terms of Reference, which were not fully aligned with current CIPFA guidance. RESOLVED unanimously: That the report be noted.
  • p614. Annual Governance Statement Coral Harding, Interim Monitoring Officer, presented the report. Members were advised that the Annual Governance Statement (AGS) would be a living governance improvement framework rather than a one-off compliance document. Six key improvement priorities were identified: financial resilience and transformation, strategic risk management, governance documentation and policy ownership, internal control weaknesses, senior officer performance management, and procurement and contract management. Strategic Risk and Corporate Assurance activities would continue to drive the Audit Committee work programme , supported by quarterly governance reviews and regular monitoring. Members welcomed that there would be improved risk reporting to Cabinet. Discussion ensued regarding the implementation of high-priority actions. Officers reported that greater organisational engagement and quarterly monitoring would improve delivery of agreed actions. In response to questions regarding reserve levels and the use of reserves, the Deputy Chief Finance Officer advised that improved financial management would focus on expenditure within approved budgets, therefore reducing reliance on reserves and instead creating opportunities to strengthen reserves through efficiencies and underspends. RESOLVED unanimously: That the Audit Committee approve the 2025/26 Annual Governance Statement for publication alongside the Statement of Accounts. Reason: To meet the Council’s legal requirement to undertake an annual review of the effectiveness of its system of internal control and publish an Annual Governance Statement, and to support continuous improvement in the Council’s governance and assurance framework.
  • p715. Grant Thornton External Audit Plan - 2025/26 The Deputy Chief Finance Officer introduced the report together with Oliver Moore of Grant Thornton who presented the External Audit Plan. The proposed audit fee for 2025/26 would be £173,397, a reduction on the 2024/25 fee of £184,656. Members were advised that external audit would focus on accounting estimates, financial controls, asset and pension valuations, value for money arrangements and reporting requirements associated with Hastings Housing Company. It was confirmed that fieldwork would commence in July and conclude during November 2026, with findings scheduled to be reported to the Committee in December. Cllr Webb set out his concerns relating to Hastings Housing Company, which included the recovery of historic loans, property valuations and governance arrangements. The Deputy Chief Finance Officer responded that discussions remained ongoing regarding legal matters associated with the company, which had ceased trading, and confirmed that property assets had been brought back in-house. Members continued to express concern about valuation processes, lease information provided to valuers, and the Council’s reported status (p47) as an unsecured creditor. The Deputy Chief Finance Officer advised that significant improvements had been made to the management of the asset register and engagement with valuers; and undertook to provide further clarification to the Committee regarding the loan arrangement the Council had with HHC. RESOLVED unanimously: That the Grant Thornton External Audit Plan 2025/26 for the Council be noted. Reason: To advise the Committee of the External Audit annual plan for the Council for the audit of the 2025/26 Statement of Accounts and advise on emerging national issues and developments that may be relevant to the Council.
  • p816. External Audit Recommendations Progress update The Deputy Chief Finance Officer presented the update and reported significant progress in implementing audit recommendations. Members were advised that 42% of actions had been completed and 58% were in progress when the report was prepared, with additional actions completed subsequently. The Committee was informed that the Council had met the statutory deadline for publication of the unaudited 2025/26 Statement of Accounts, representing a significant improvement from previous years. Progress had been made in strengthening financial governance, internal controls, valuation processes, audit readiness and staff training. Members discussed recruitment challenges arising from Local Government Reorganisation and the wider shortage of qualified technical accountancy staff. Officers advised that apprenticeships, professional development and cross-authority collaboration were being used to address capacity issues. The Deputy Chief Finance Officer cautioned that, notwithstanding the progress made, the 2025/26 accounts were still expected to receive a disclaimed audit opinion because external auditors could not yet place reliance on opening balances affected by historic disclaimed accounts. Oliver Moore advised that this was an issue affecting many authorities and that work was underway to develop a sector-wide approach to rebuilding assurance. RESOLVED unanimously: To note the progress against the management actions to address the audit recommendations. Reason: To give assurance to the Committee that the external audit recommendations are being actively implemented and to give the Committee an opportunity to review any areas of concern.

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