The Audit and Risk Management Committee of Bromley Council met on Thursday 25 June 2026 to review the Council's internal audit findings, counter fraud activities, and the annual governance statement. The committee was also scheduled to discuss the external audit plans for the upcoming year and the current status of outstanding matters from previous meetings.

External Audit Plans 2025/26

The committee was presented with the external audit plans for the Pension Fund and the main Council Accounts for the 2025/26 financial year, prepared by Ernst & Young LLP (EY). These plans outline the proposed audit approach and scope, in accordance with the Local Audit and Accountability Act 2014 and the National Audit Office's Code of Audit Practice. The report noted that the Council's accounts for 2020/21 to 2024/25 had received disclaimed opinions due to resource limitations preventing the completion of full audits before statutory backstop dates. While the Pension Fund accounts had received unqualified opinions, EY anticipated issuing a disclaimed opinion again for the Council's 2025/26 accounts due to ongoing assurance issues over opening balances. The report emphasised that this disclaimed opinion did not reflect concerns over the Council's financial position but was solely a consequence of resource limitations. EY's plans included rebuilding assurance over opening balances and addressing statutory recommendations from previous audits, such as those related to the Finance Function Workflow Review, Quality Assurance Function Review, and Finance Team Capacity.

Annual Internal Audit Report 2025/26

Francesca Chivers, Head of Audit and Assurance, presented the annual report and opinion for 2025/26. The report concluded that there was Reasonable assurance overall on the effectiveness of the Council's risk management, governance, and control processes. This opinion was based on 29 pieces of work that received a formal assurance opinion, with 79% of audits receiving 'Reasonable' assurance and 7% receiving 'Substantial' assurance. Common strengths identified across the audits included formal governance structures, clearly defined roles and responsibilities, and strong compliance in transactional financial processing. However, 'Limited' assurance opinions were issued in specific statutory service areas, such as Homelessness Reviews, Food Safety, and Tree Preservation Orders, primarily due to backlogs and issues with statutory timescales or consultation processes. The report also highlighted an increase in medium-risk recommendations compared to the previous year, potentially indicating a weakening control environment during a period of significant organisational change. The report also detailed the outcomes of advisory work undertaken by Internal Audit, including reviews of the Dedicated Schools Grant Deficit Recovery Plan and the Adult Social Care Performance Management Framework.

Counter Fraud Report 2025/26

The committee received an update on counter fraud activities for the 2025/26 financial year. The report detailed the Council's approach to fraud prevention and investigation, in line with the Counter Fraud Strategy approved in November 2025. It highlighted the implementation of actions to improve compliance with the Economic Crime and Corporate Transparency Act 2023, including mandatory fraud awareness e-learning and targeted training. Proactive counter fraud work in Temporary Accommodation identified 18 placements closed, resulting in an in-year saving of £164,172. The Council also participated in data matching exercises through the National Fraud Initiative and the London Fraud Hub, which identified potential cases of career polygamy fraud and other discrepancies. The report detailed fraud referral and investigation statistics, including 114 Blue Badge fraud referrals and a successful prosecution for sub-letting Temporary Accommodation. An increase in referrals for false applications and documentation was noted, with an estimated fraud prevention value of £20,000 from three closed cases. Blue Badge fraud outcomes for 2025/26 included 81 prosecutions, resulting in fines, prosecution costs, and victim surcharges totalling £43,825. Minor amendments to the Whistleblowing Policy were presented for approval, including updates to contact details and the inclusion of sexual harassment as a protected disclosure following the Employment Rights Act 2026.

Annual Governance Statement 2025/26

The committee was presented with the draft Annual Governance Statement (AGS) for 2025/26 for approval. The AGS provides a formal assessment of the effectiveness of the Council's governance arrangements, drawing on internal and external assurance sources. These included the Internal Audit Annual Opinion, External Audit findings, the Care Quality Commission (CQC) assessment of adult social care, and a Corporate Peer Challenge by the Local Government Association. The AGS concluded that the Council's governance arrangements are generally effective, providing a sound basis for decision-making, despite the challenging operating environment. However, targeted areas for further strengthening were identified, including finance capacity, audit readiness, financial reporting, embedding risk management, enhancing scrutiny arrangements, clarifying governance for transformation, and strengthening formal mechanisms for evidencing organisational culture and ethical standards. An action plan for 2026/27 was included, outlining specific actions to address these areas, with owners and timescales assigned.

Risk Management

The committee reviewed the most recent iteration of the Corporate Risk Register and summary heat maps for Departmental Risk Registers. The report detailed key changes to the Corporate Risk Register since November 2025, including the addition of a new risk on Provider Failure and Polygamous Working, and the replacement of the Temporary Accommodation risk with Failure to meet the Council's statutory homelessness duties. A new draft risk register template and dashboard were presented for review, designed to align with the risk management strategy and facilitate better reporting. The template includes target risk scores, gross and net risk scores, date of last review, and direction of travel. The heat maps provided a visual representation of the net risk score for each risk after controls have been applied. The report also outlined the Council's risk assessment guidance, detailing likelihood and impact scoring for various risk categories.

Matters Outstanding from the Meeting on 25th February 2026

The committee was provided with an update on matters outstanding from the previous meeting held on 25th February 2026. The report indicated that most issues were being addressed in more detail within other agenda items. One specific matter regarding DSG deficits was noted as closed.

Confirmation of the Minutes of the Meeting Held on 25th February 2026

The committee was asked to confirm the minutes of the previous meeting held on 25th February 2026 as a correct record.

Questions to the Audit and Risk Management Committee

Members of the public and councillors were invited to submit questions to the committee. Questions not specific to agenda reports needed to be received in writing by 11th June 2026, while questions seeking clarification on agenda reports were to be received by 19th June 2026. Members of the public could ask one question each, either at the meeting or requiring a written response.