The London Assembly Audit Panel met on Wednesday 21 October 2026 to review the Greater London Authority's (GLA) financial statements and internal audit reports. Key discussions included the external audit findings, which highlighted issues with property classification at the Old Oak and Park Royal Development Corporation (OPDC) and the valuation of long-term debtors. The panel also reviewed internal audit progress, focusing on the Adult Skills Fund and payroll processes, and discussed the corporate risk register, noting new risks related to elections and devolution.

External Audit Report

Ian Young from EY presented the External Audit Report, stating that the audit of the GLA's financial statements for the year ending 31 March 2026 was substantially complete and an unqualified opinion was expected. However, two significant issues were identified. Firstly, certain non-current assets classified as investment property at OPDC did not meet the relevant definition and should be reclassified as property, plant and equipment. This will require a prior period adjustment. Secondly, a potential misstatement was identified in the valuation of a long-term debtor due to an incorrect interest rate being applied. Management is addressing these issues.

The report also highlighted the ongoing issue of the London Stadium's onerous contract provision, which continues to be a significant financial commitment. Léonie Cooper AM expressed frustration with this long-standing issue, attributing it to decisions made by the previous Mayor, Boris Johnson. Concerns were also raised about the £24 million to £26 million annual cost of the Oxford Street regeneration project, with assurances that it would be funded by commercial sponsorship and street activations, of which currently zero pounds have been secured.

Internal Audit Reports

Mark Woodley, Group Audit Lead from MOPAC, provided an update on internal audit progress. The Adult Skills Fund governance framework received a Substantial Assurance rating, with improvements noted in provider performance monitoring. However, two advisory actions were recommended: updating outdated references in the framework and including fraud awareness training for provider managers.

A follow-up review of the Material Systems Payroll Audit indicated progress in strengthening payroll controls, with five out of seven agreed actions fully implemented. The overall assurance opinion remained Reasonable Assurance. However, two areas require attention: consistent retention of evidence for new starter checks and the formal approval of draft terms of reference for performance meetings. Diane Tranmer, Executive Director of Corporate Resources and Business Improvement at the GLA, confirmed that the error rate in payroll had been reduced to below 1%, a significant improvement from previous levels.

The Directorate for Audit, Risk and Assurance (DARA) underwent an External Quality Assessment (EQA) against the Global Internal Audit Standards (GIAS). The independent assessor concluded that the service Generally Conforms with the standards, representing a positive outcome. However, seven formal recommendations were made to enhance conformance, particularly in developing a formal Quality Assurance and Improvement Programme (QAIP), undertaking EQAs at least every five years, finalising the Audit Manual, developing an Internal Audit Strategy, and enhancing stakeholder engagement.

Corporate Risk Register

Faye Hammond, Chief Finance Officer at the GLA, presented the refreshed corporate risk register. Two new risks have been introduced: Elections 2028, reflecting operational planning for the upcoming elections, and Devolution, acknowledging the opportunities and potential changes in statutory responsibilities and governance expectations arising from the government's devolution agenda. Several existing risks were reframed, including Funding to reflect changes in the business rates regime, Corporate Governance to better align with delivery planning, and Workforce to account for the need for agility in response to devolution agendas. The risks related to Corporate EDI and Alignment of budget to Mayoral priorities were removed, as these are now considered to be managed at a directorate level or have been significantly mitigated.

Concerns were raised about the persistent High rating for cyber risk, despite efforts to improve security. It was explained that cyber risk is inherently high for any organisation, and while controls are in place, the risk level is unlikely to decrease significantly. Discussions also touched upon the economic viability of construction projects due to rising costs, and how this is captured within broader financial resilience and company governance risks.

Other Items

The panel noted the draft Annual Governance Statement for 2025-26, the monitoring of expenses and taxable benefits for the Mayor, elected members, and senior staff, and the registers of gifts and hospitality for both elected members and staff. The expenses report showed a significant increase in foreign travel costs for senior staff compared to the previous period. The register of gifts and hospitality indicated a total of 26 declarations from the Mayor and Assembly Members, and 198 declarations from staff, with a decrease in the timeliness of staff declarations compared to the previous period.