The Audit, Standards and Risk Committee of Surrey Heath Borough Council convened on 23 September 2025, to discuss the corporate risk register, the capital and investment report, external audit recommendations, outstanding audit recommendations, and the committee's work programme. The committee noted the progress made on external audit recommendations and outstanding items, as well as the status of internal audit recommendations. They also approved the annual capital and investment outturn report, including compliance with the 2025/26 prudential indicators.

Corporate Risk Register

The committee reviewed the corporate risk register, which identifies significant strategic risks to the council's objectives. The Corporate Risk Management Officers Group (CRMOG) reviews the register quarterly, and the Audit, Standards and Risk Committee reviews changes and updates every six months, in accordance with the Risk Management Strategy.

Key updates and changes in risk scores included:

• Risk 1; Information Management: Updated to include mitigation measures for sharing personal data during local government reorganisation (LGR).
• Risk 2; Loss of adequate funding for service: The 'Fair Funding' government consultation has been included, and the risk level remains medium (6) pending the outcome of the funding review.
• Risk 5; Major incident: Mitigations updated to reflect that 20 officers will be trained to Borough Emergency Coordinator (BECC) level.
• Risk 9, Cyber Security: Increased from medium to high risk due to recent high-profile cyber-attacks.
• Risk 10, Transformation program: Mitigations updated to include committee review of the program and the potential use of asset sales to cover transformation costs.
• Risk 11; Recruitment and retention: Mitigations updated to reflect staff turnover at usual levels and the inclusion of succession planning and policy changes to improve staff retention, though the risk level could increase in the coming months due to LGR uncertainty.
• Risk 12; Local Government Reorganisation: Added as a new risk.

The committee was advised to consider the strategic risks and comment on changes to risk scores.

Capital and Investment Report

The committee reviewed the capital and investment report for the year to date, which included a summary of treasury performance and compliance with the 2025/26 treasury management strategy, as well as the position of the capital programme.

Key points from the report:

• The balance at 31 August 2025, was £17.58 million held in investments (projected interest for the year of £700,000), with a current average portfolio return of 4.23%, and £179.46 million held in borrowing (projected interest payable of £7 million), with a current weighted average borrowing rate of 3.64%, equating to £161.88 million of net borrowing.
• As of 31 August 2025, the Council has spent £998,000 with commitments of a further £2.929 million against an original budget of £11.736 million, and a revised budget of £16.382 million.
• £330,000 can be released from the capital programme due to projects being superseded or delivered in 2024/25.
• Approval was sought to reprofile £538,000 into future years for the London Road Block (Acquisitions) project, as there are no plans to acquire further properties in 2025/26.

The committee was asked to note the annual capital and investment outturn report, including compliance with the 2025/26 prudential indicators¹.

External Audit Recommendations 2024/25

The committee received an update on the external audit recommendations set out in the Grant Thornton audit findings report for the year ending 31 March 2024. The 2023/24 accounts had been disclaimed², and addressing these matters is necessary to move towards assurance.

The committee was asked to note the progress made on the external audit recommendations and outstanding items, as detailed in the action plan.

Outstanding Audit Recommendations

The committee received an update on internal audit recommendations, with each recommendation classified as essential, desirable, or best practice. As of the end of August 2025, there were 18 overdue audit recommendations, six of which related to the Business Improvement District (BID) process. Meetings have been held with the BID board to address these issues.

Work Programme

The committee noted its work programme for the remainder of the 2025/26 municipal year, including the potential to bring forward the March meeting to consider the Audit Findings Report before the statutory backstop date. The committee also noted that a report was due from the Head of Legal and Democratic Services, Nathalie Boateng, regarding the resourcing of the internal audit function.