The Audit and Governance Committee of Buckinghamshire Council met on Tuesday 21 July 2026 to review the council's financial performance and internal audit processes. Key discussions included the Treasury Management Annual Report for 2025/26, which showed a favourable variance of £12.08 million, and the Chief Auditor's Annual Audit Opinion for the same period, which concluded a 'reasonable' level of assurance. The committee also approved the Internal Audit and Counter Fraud Plan for 2026/27.

Treasury Management Annual Report 2025/26

Councillor Robert Carington, Cabinet Member for Resources, introduced the Treasury Management Annual Report for 2025/26. The report detailed the council's investment and borrowing activities, highlighting a favourable variance of £12.08 million against budgeted forecasts. This overperformance was attributed to higher-than-expected cash balances for short-term investments, a reprofiling of the capital programme, and a slower reduction in interest rates than anticipated. All prudential indicators for the year were reported as 'Green', indicating strong performance against affordability, external debt, and capital expenditure measures.

During the discussion, Councillor Simon Rouse sought clarification on the breakdown of the overperformance between structural factors and one-off cash wins, expressing a desire for greater visibility on the genuine Treasury performance. Councillor Stuart Wilson raised concerns about the potential implications of a delay to a statutory override related to International Financial Reporting Standards (IFRS) 9 and inquired about the dividend from the CCLA investment. Fiona Jump, Deputy Chief Finance Officer, explained that the statutory override delay was to avoid crystallising potential losses on investments, and that a provision of £1 million had been set aside. The dividend from the CCLA investment was accounted for within the overall treasury management investment income.

Councillor Anna Crabtree questioned the significant drop in the revenue contribution to capital reserves and sought assurance on the decision-making processes. David Skinner, Service Director of Finance and Section 151 Officer, explained that these decisions were monitored through the financial reporting process and considered by Cabinet. He also clarified that a reduction in the authorised limit for external debt reflected a more accurate assessment of likely borrowing needs rather than adverse circumstances.

Councillor Kelly Thornton raised concerns about the risks in local authority lending and the financial and governance tests applied to counterparties. Councillor Robert Carington outlined the stringent controls in place, including a 'green, amber, red' watch list for local authorities, and confirmed that only 'green' authorities were lent to. He also noted that a more detailed report on local authority lending would be presented to the committee at its next meeting.

Councillor Chris Pohl inquired about potential government mandates for UK investment and areas where the council would not invest. Councillor Robert Carington confirmed that the government could mandate investment direction, citing previous actions regarding pension funds. He also stated that the council followed credit ratings and would not invest in entities below AA, nor in local authorities on the amber or red watch list.

Chief Auditor's Annual Audit Opinion 2025/26

Selina Harlock, Interim Head of Business Assurance and Chief Auditor, presented the Chief Auditor's Annual Audit Opinion for 2025/26. The report provided an opinion on the adequacy and effectiveness of the council's governance, risk management, and internal control environment. The overall opinion was 'reasonable assurance', indicating that while a sound system of control exists, there were some areas of weakness or scope for improvement that could put the achievement of objectives at risk. No 'no assurance' opinions were issued, and there were no identified instances of misstatement or losses that had a material impact on the council's affairs.

Councillor Simon Rouse congratulated the team on their work but questioned why an audit on contract management had not been undertaken in 2025/26, given its previous 'limited assurance' rating. Selina Harlock explained that the deferral was due to significant changes within the service, including the implementation of a new system and a restructure, and that a full audit was planned for the following year. Councillor Rouse also sought clarity on how the audit team's performance was measured and expressed confidence in the traction gained with the corporate management team on audit issues. Russell Heppleston, Chief Auditor, assured the committee that performance metrics were tracked and would be included in future reports. He also expressed confidence in the current audit culture within the council.

Councillor Stuart Wilson echoed concerns about contract management and noted the ongoing recruitment for a head of procurement and commissioning. He also raised a point about the circulation of internal audit reports to select committee chairs, suggesting that these should be shared regardless of the assurance level. Leslie Ashton, Committee and Governance Officer, confirmed that some reports had been shared with select committee chairs and that papers were available on ModGov. Councillor Robert Carington confirmed that relevant cabinet members received both reports and outcomes.

Councillor David Moore inquired about the 'limited assurance' tag on the rights of way audit and the actions being taken to address high-priority problems. Selina Harlock stated that while she could not provide a holistic view of rights of way, the audit findings had been progressed, and KPIs were part of the improvement process. Councillor Anna Crabtree raised concerns about the subjectivity of the audit opinions and questioned the confidence that could be placed in the overall 'reasonable' opinion, suggesting that controls might only be implemented after audit findings. Selina Harlock explained that the opinion was based on a risk-based approach and a snapshot in time, and that a 'no assurance' opinion would be issued if fundamental control gaps were identified.

Internal Audit and Counter Fraud Plan 2026/27

Russell Heppleston presented the Internal Audit and Counter Fraud Plan for 2026/27. The plan outlined 54 planned assurance and advisory engagements across all directorates, focusing on key areas such as financial control, cybersecurity, major projects, SEND reform, and contract management. The counter fraud plan included activities under the themes of Govern, Acknowledge, Prevent, and Pursue, aiming to strengthen fraud prevention, detection, and recovery. He confirmed that, based on available resources, there would be adequate capacity and capability to deliver the plan. The committee was asked to comment on and approve the plan.

Councillor Stuart Wilson raised questions about specific audits within the Assistant Chief Executive and Communities directorates, including the lottery audit and procurement. He also inquired about the focus on children's services and SEND sufficiency planning, given the revenue position. Russell Heppleston addressed these points, explaining the rationale behind the audit plan's priorities and the approach to specific areas.

The committee formally approved the Internal Audit and Counter Fraud Plan 2026/27.

Achievement of a 'Substantial' Chief Internal Auditor's Annual Opinion

Fiona Jump, Deputy Chief Finance Officer, presented a report on the achievement of a 'Substantial' Chief Internal Auditor's Annual Opinion. The report detailed the council's assurance levels since its unitary status, highlighting improvements in key financial systems and contract management. It noted that while no English unitary shire councils achieved a 'Substantial' opinion in 2024/25, Buckinghamshire Council was performing well with a 'Reasonable' assurance level. The report proposed an assurance mapping exercise to identify strengths and gaps across directorates, with findings to be shared with Cabinet and the Audit and Governance Committee.

Councillor Stuart Wilson commented on the fact that no comparable authorities had achieved a 'Substantial' opinion, suggesting it might be an unachievable rating. Fiona Jump clarified that while it was possible, it was rare, and Buckinghamshire was performing well compared to similar authorities. Councillor Chris Pohl expressed concern that the council was marking its own homework and sought reassurance about future unqualified opinions from external auditors. Sarah Brown, Engagement Partner from KPMG, explained the pathway to removing disclaimers on previous audit opinions and expressed confidence in achieving an unmodified position in the future.

Appointments to Risk Management Group and Work Programme

Councillor Matthew Walsh, Chair of the Audit and Governance Committee, announced his appointments to the Risk Management Group for the council year. The committee then reviewed the Work Programme for 2026/27, noting the inclusion of the Annual RIPA and Communications Data Report, the Strategic Risk Update, and the Breach Report update. Councillor Simon Rouse sought clarification on the corporate PMO assurance review within the work programme, which was confirmed to be in progress. Councillor Stuart Wilson inquired about the circulation of Risk Management Group minutes, and Leslie Ashton confirmed they were accessible on ModGov.

The committee noted the Action Log and the Work Programme. The date of the next meeting was confirmed as Tuesday, 29 September 2026.

The public session of the meeting concluded, and the committee moved to a confidential session to discuss exempt information.