The Audit and Governance Committee of Shropshire Council met on Thursday 25 June 2026 to review a range of assurance reports concerning the Council's financial management, risk, and governance frameworks. The meeting's agenda focused on assessing the effectiveness of internal controls, audit plans, and the Council's overall approach to risk management, with a particular emphasis on the findings of the Internal Audit Annual Report for 2025/26.

Annual Assurance Report of the Audit and Governance Committee to Council 2025/26

The committee was scheduled to consider the draft Annual Assurance Report to Council for 2025/26. This report is a key part of the Audit Committee's role in informing Full Council about its findings, conclusions, and recommendations. The report indicated that the committee could only provide limited assurance regarding the Council's governance, risk management, and internal control frameworks. This limited assurance was a concern, particularly in light of the Chief Audit Executive's opinion, and its potential impact on value for money. The report was intended to be forwarded to the Council with a recommendation that the Council endorse the committee's opinion that it had operated effectively and note the limited assurance provided.

External Audit Plans for Shropshire Council and Shropshire County Pension Fund 2025/26

The committee was to receive an overview of the planned external audit work for the 2025/26 financial year for both Shropshire Council and the Shropshire County Pension Fund. These plans, presented by Grant Thornton, the external auditors, outlined the scope and timing of the statutory audits. The plans detailed significant risks identified, including management override of controls and the valuation of assets such as land, buildings, council dwellings, investment properties, and the gross pension liability. For the Shropshire County Pension Fund, significant risks included management override of controls and the valuation of Level 3 investments. The audit plans also addressed the Council's arrangements for securing economy, efficiency, and effectiveness in its use of resources, with identified risks in financial sustainability and governance.

Audit and Governance Committee Work Plan 2026/27

The committee was scheduled to review and potentially make changes to its proposed work plan for 2026/27. This plan outlines the key topics to be considered at future meetings and the learning and development sessions planned for committee members to ensure they are well-informed and appropriately skilled. The work plan is structured to demonstrate how the committee's activities support its terms of reference and the assurance levels required. It covers core statutory elements and also accounts for additional reports that may be requested throughout the year, such as management updates arising from limited or unsatisfactory audit opinions.

Internal Audit Performance Report and Revised Annual Audit Plan 2025/26

This report provided an update on the work undertaken by Internal Audit in the final quarter of the 2025/26 financial year. It detailed the assurance ratings and recommendation categories for completed audits. The report highlighted that while overall plan delivery was strong, there was a decrease in higher levels of assurance compared to the previous year, with a corresponding increase in limited and unsatisfactory opinions. The percentage of significant and fundamental recommendations had also deteriorated. The report noted that the overall opinion on the control environment had been Limited for seven consecutive years, although there were signs of improvement in the final quarter of 2025/26. The committee was asked to consider the performance against the audit plan, endorse the Chief Audit Executive's Limited assurance opinion, and request executive and senior officers to address identified weaknesses.

Internal Audit Annual Opinion 2025/26

This report summarised the Internal Audit work for the year ended 31 March 2026, providing the Chief Audit Executive's opinion on the Council's framework for governance, risk management, and internal control. The overall opinion was Limited Assurance, reflecting continuing weaknesses in the internal control environment. The report acknowledged the Council's response to its financial emergency, including strengthening governance and oversight, but noted that the full impact of these changes was still emerging. The report highlighted the need for a proactive approach to addressing weak internal controls and fostering a culture of improved accountability. It also noted that external audit had previously criticised this position.

Programme Management Office Project Management 2025/26: Management Update

This report provided an update on the progress made by the Programme Management Office (PMO) in response to an internal audit review conducted in August-September 2025, which had given a limited assurance rating. The report detailed the management's actions and subsequent improvements made in response to the audit's recommendations, which focused on governance structures, risk and resource management, and performance monitoring. The report highlighted significant changes since the audit, including the development of an organisational Improvement Plan and a review of the PMO's role, aimed at strengthening project and programme delivery.

Annual Whistleblowing Report 2025/26

This report provided an update to the committee on the number of whistleblowing cases raised concerning Council employees during the last financial year. It indicated an increase in reports compared to the previous year, with the predominant theme being Council Tax/NDR. The report also detailed the methods of communication used for reporting and the outcomes of the cases. It highlighted key developments in whistleblowing legislation and outlined planned activities for the coming year to further strengthen staff awareness and confidence in the Council's whistleblowing arrangements.

Other items scheduled for discussion included:

• Minutes of the previous meetings held on the 5 February 2026 and 14 May 2026: These were to be confirmed as a true record.
• Public Questions: An opportunity for members of the public to ask questions.
• Member Questions: An opportunity for councillors to ask questions.
• Governance assurance: Audit and Governance Committee Work Plan 2026/27: A review of the committee's planned activities and learning and development for the upcoming year.
• Third line assurance: Internal Audit Performance Report and Revised Annual Audit Plan 2025/26: An update on Internal Audit's work and performance against the plan.
• Third line assurance: Internal Audit Annual Report 2025/26: The Chief Audit Executive's annual opinion on the Council's governance, risk management, and internal control framework.
• Third line assurance: Treasury Strategy 2026/27: A proposal for the Council's approach to managing its treasury activities for the upcoming financial year.
• Third line assurance: Internal Audit Plan 2026/27: The proposed risk-based Internal Audit Plan for the next financial year.
• Date and Time of Next Meeting: Noted for information.
• Exclusion of Press and Public: To consider excluding the press and public for specific agenda items.
• Exempt Minutes of the previous meeting held on the 5 February 2026: To be confirmed.
• Third Line Assurance: Fraud, Special Investigation and RIPA Update (Exempted by Categories 1, 2, 3 and 7): An update on fraud investigations and RIPA activity.
• Third line assurance: Contract Rules Exemptions Update (Exempted by Category 3): An update on exemptions sought from the Council's Contract Procedure Rules.