The Audit Committee of Cornwall Council met on Friday 22 May 2026 to review a range of financial and governance matters. Key discussions were scheduled to include the council's external audit plans for both the main council and the pension fund, the annual governance statement, and the chief internal auditor's annual report. The committee was also set to receive updates on council-owned companies and the broader audit sector.

Appointment of Independent Audit Lay Member

The committee was scheduled to discuss the appointment of an independent lay member to the Audit Committee. This role is intended to provide an independent perspective and add value to the committee's work, aligning with guidance from the Chartered Institute of Public Finance and Accountancy (CIPFA). An Appointments Panel, comprising three Audit Committee Members including the Chair, was proposed to manage the recruitment process. Authority would be delegated to this panel to select a candidate and make recommendations to the Council for approval. The cost of the recruitment campaign and subsequent annual costs would be met from the Member Support budget.

Council Owned Companies - Annual Third-Party Assurance Summary and Forward Assurance Plans

A report was presented to provide the Audit Committee with a consolidated view of third-party assurance outcomes and planned assurance activity for 2025/26 and 2026/27 across Cornwall Council's owned companies: Cornwall Housing Ltd, Corserv Ltd, Celtic Sea Power Ltd, and Treveth Property Holdings LLP. This assurance activity includes internal audit, external audit, regulatory inspections, and other independent assurance providers. The report aimed to support the Audit Committee's oversight role and fulfil requirements set out in the Council's Articles of Association regarding governance arrangements for Council-owned entities. The report highlighted the assurance status for each company, noting areas of Limited Assurance for Cornwall Housing Ltd (specifically regarding Health & Safety Contract Management & Procurement) and Corserv Ltd (regarding PRA commercial arrangements and some Care services). Treveth Property Holdings LLP received no formal assurance opinions, with comprehensive improvement actions agreed across various areas.

Cornwall Council External Audit Plan 2025-26 and Audit Committee Update and Audit Sector Briefing

The committee was set to review the External Auditor's Audit Plan for Cornwall Council for the 2025/26 financial year. This plan outlines the scope and timing of the statutory audit, including the auditor's opinion on the Council's financial statements and an assessment of its arrangements for economy, efficiency, and effectiveness in the use of resources. Significant risks identified for the audit included management override of controls, valuation of land and buildings (including council dwellings), valuation of the pension liability, group consolidation, and fraud in revenue recognition (for the Group). A significant weakness was noted regarding the Dedicated Schools Grant (DSG) deficit, with the forecast outturn for 2025/26 worsening and expected to increase the cumulative deficit. The report also included an update and sector briefing from the external auditor, Grant Thornton, covering progress on the audit and current issues facing the local government sector.

Cornwall Pension Fund External Audit Plan 2025-26

The committee was scheduled to review the External Auditor's Audit Plan for the Cornwall Pension Fund for the financial year ending 31 March 2026. This plan details the scope and timing of the statutory audit of the Pension Fund's financial statements. Significant risks identified for the Pension Fund audit included management override of control and the valuation of Level 3 investments. The plan also outlined the approach to materiality, IT audit strategy, fees, and independence considerations. A fee variation of £5,000 was proposed for additional work related to the triennial valuation testing of individual member data.

Annual Governance Statement 2025-26

The committee was to consider the draft Annual Governance Statement (AGS) for 2025/26. This statement, prepared in accordance with the Accounts and Audit Regulations 2015 and CIPFA/SOLACE guidance, assesses the Council's compliance with its Local Code of Corporate Governance. The draft AGS included a RAG rating of the seven core principles of good governance, identifying areas of strength and those requiring improvement. A significant governance issue from the previous year, Joint commissioning arrangements for Health and Social Care, was noted as closed for Safe and Caring Communities but carried forward for Together for Families. A new significant governance issue was identified relating to the method used for the registration of officer declarations of interest, gifts, and hospitality.

Chief Internal Auditor Annual Report 2025-26

The committee was set to receive the Chief Internal Auditor's Annual Report for 2025/26. This report provides an opinion on the overall adequacy and effectiveness of the Council's framework of governance, risk management, and internal control. The overall opinion provided was one of reasonable assurance, indicating that while a generally sound system is in place, some issues, non-compliance, or scope for improvement were identified that could put the achievement of objectives at risk. The report detailed audit findings across various directorates, highlighting areas of Limited Assurance in Contract Management and Officers' Declarations of Interests, Gifts and Hospitality, and High Risk in Financial Reporting & Savings Monitoring, Direct Payments and ISF Payments Process, and SEND Inspection Readiness. The report also included the Annual Risk Management Report and the Counter Fraud Annual Report.

Internal Audit Plan 2026-27 and Associated Policies

The committee was asked to approve the Internal Audit Plan for 2026/27 and the approach to programming. This plan was developed considering various factors, including previous audit findings, strategic risks, statutory requirements, and emerging issues. Additionally, the committee was to consider and note a suite of refreshed Internal Audit and Fraud Strategies and Policies, including the Audit Committee Terms of Reference, Internal Audit Charter, Internal Audit Strategy, Counter Fraud & Corruption Strategy, Anti-Fraud, Bribery & Corruption Policy, Anti-Money Laundering Policy, and Whistleblowing Policy.

Audit Committee Annual Report 2025-26

The committee was scheduled to review and agree the Audit Committee Annual Report for 2025/26. This report summarises the committee's activities, including its work on internal audit, external audit, risk management, governance, and anti-fraud measures. It also incorporates the committee's work programme for 2026/27 and the results of a self-assessment of the committee's effectiveness against good practice guidance. The report concluded that the committee was satisfied with its arrangements and would continue to champion strong internal control, governance, and risk management. The committee was also asked to approve the 2026/27 Work Programme and the Audit Committee Self-Assessment.