The Corporate Committee of Lambeth Council met on Thursday 26 March 2026 to discuss the Council's action plan in response to external auditor recommendations, the final statement of accounts for 2024-25, and updates on internal audit and counter-fraud activities. Key decisions included the approval of the final statement of accounts for 2024-25 and the agreement to close several actions related to the Council's response to external auditor recommendations.

Update on the Council's Action Plan Response to External Auditor Recommendations

The committee reviewed the progress made on the Council's action plan in response to recommendations from external auditors, Forvis Mazars. Two actions, SR3-02 (Reserves strategy for General Fund and HRA) and SR4-05 (Review and revise the Treasury Management Strategy), were recommended for closure as they were deemed complete. The report detailed significant work undertaken to improve financial stability, including rebuilding reserves through the Exceptional Financial Support (EFS) funding, pausing the capital programme, and implementing a flexible use of capital receipts policy. The Council has received approval for £116 million in EFS to support its financial recovery.

Final Statement of Accounts 2024-25, Update on 2025-26 Statement of Accounts and Update on Closedown and Accounts Improvement Plan

The committee considered the final Statement of Accounts for 2024-25, which were approved and received an audit opinion ahead of the national backstop date. Changes made to the accounts since the previous committee meeting included the incorporation of £50 million in Exceptional Financial Support (EFS) to rebuild reserves, and technical reclassifications related to the Resonance Fund, capital grants, and HfL loan balances. The report also provided an update on the progress of the closedown process for the 2025-26 accounts, highlighting the development of a comprehensive timetable and the establishment of a Balance Sheet Review Working Group. The Closedown and Accounts Improvement Plan is being implemented to enhance the quality and timeliness of future accounts.

Annual Governance Statement 2024/25 Action Plan Update

An update was provided on the progress made against the action plan developed to address issues and challenges identified in the 2024/25 Annual Governance Statement. The report indicated that significant progress has been made in delivering actions related to financial stability, responding to external auditor recommendations, and improving the preparation of financial accounts. However, challenges remain in managing demand pressures in social care and temporary accommodation, and consistent compliance with core financial controls.

Internal Audit Progress Report 2025-26

The committee received an update on the progress of the Internal Audit plan for 2025-26. As of 27 February 2026, 63% of audits were completed, with a further 23% in draft reporting. Implementation rates for management actions arising from limited assurance reports have improved, with high-priority actions at 91% and medium-priority actions at 66%. However, a significant number of medium-priority actions remain overdue. The report detailed findings from various school audits, with several highlighting concerns regarding budgetary control, governance, and financial management, particularly for schools that have recently de-federated from the Gipsy Hill Federation.

Internal Audit Risk-Based Plan, Strategy, Charter and Mandate

The committee reviewed the proposed Internal Audit Plan for 2026/27, the three-year strategy, and the refreshed Internal Audit Charter and Mandate. The plan is risk-based and agile, with a six-month rolling model to adapt to emerging risks and priorities. Key themes include financial resilience, digital governance, AI, and frontline service areas. The strategy aims to enhance the Council's governance, risk management, and internal control processes, with a vision to be a leading provider of internal audit services. The Charter and Mandate outline the purpose, authority, and responsibilities of the internal audit service, ensuring its independence and objectivity.

Counter Fraud Progress Report 2025-26 and Draft Work Plan 2026-27

An update was provided on counter-fraud activities for 2025-26, showing an increase in new investigations and a stable rate of closures. Tenancy fraud investigations and recoveries are slightly up on the previous year, and internal investigation reports have also increased. The report detailed the progress of the National Fraud Initiative (NFI) data matching exercises, which have identified significant outcomes. The draft Counter Fraud Work Plan for 2026-27 was presented, outlining a structured, risk-based programme focused on governing, acknowledging, preventing, pursuing, and protecting against fraud, bribery, and corruption.

Counter Fraud Strategy and Policies 2026-29

The committee reviewed updated versions of the Counter Fraud and Corruption Strategy, the Anti-Bribery Policy and Procedure, and the Money Laundering Policy and Practice Note. The Counter Fraud Strategy 2026-2029 has been updated to reflect the Economic Crime and Corporate Transparency Act 2023, including the new corporate offence of failure to prevent fraud. The Anti-Bribery Policy has also been strengthened in relation to corporate liability. The Money Laundering Policy includes revisions to customer due diligence guidance. Approval of these documents provides assurance that the Council has robust measures in place to prevent, detect, and respond to fraud, bribery, and money laundering.

Whistleblowing Update

An update was provided on whistleblowing referrals and investigations from 1 April 2025 to 28 February 2026. The report summarised various allegations received, including concerns over financial management, recruitment policies, safety, misconduct, fraud, bribery, and discriminatory practices. The outcomes ranged from allegations not being covered by the whistleblowing policy, matters being referred to directorates for investigation, cases being closed due to insufficient evidence, or being managed through alternative procedures. Some allegations were still pending investigation or awaiting further information.