North Yorkshire Council
Audit Committee
15 December 2025
Statement of Final Accounts 2024/25 – NYC and NYPF
Report of the Corporate Director Resources
1.0 PURPOSE OF REPORT
1.2 To approve the Statement of Final Accounts and Annual Governance Statement 2024/25 for North Yorkshire Council.
2.0 SUMMARY
2.1. This report provides an update on the audit, certification and publication of the final audited Statement of Accounts (SOFA) for North Yorkshire Council and the North Yorkshire Pension Fund accounts for 2024/25.
3.1. In July 2024 the government introduced legislation to address the backlog of outstanding unaudited local government accounts. The backstop requirements include the publication of audited accounts by statutory backstop dates as follows:
· Financial year 2024/25: 27 February 2026
· Financial year 2025/26: 31 January 2027
· Financial year 2026/27: 30 November 2027
· Financial year 2027/28: 30 November 2028
3.2 Where auditors have been unable to complete audits, they have issued a ‘disclaimed’ or ‘modified’ audit opinion. The Government acknowledge that auditors are likely to issue hundreds of ‘disclaimed’ audit opinions and disclaimed opinions will likely continue for some bodies for a number of years.
3.3 The Government have stated that while there will be modified and disclaimed opinions, auditors’ other statutory duties – including to report on Value for Money (VfM) arrangements, and, if necessary, to exercise their power to make statutory recommendations and issue Public Interest Reports – remain a high priority.
3.4 The Government have also stated that local bodies should not be unfairly judged based on disclaimed or modified opinions, caused by the introduction of backstop dates that are largely beyond their control & that auditors are expected to provide clear reasons for the issuing of such opinions to mitigate the potential reputational risk that authorities may face.
4.0 NYC & NYPF AUDIT 2024/25
4.1 The draft SOFA for 2024/25 incorporating the accounts of the North Yorkshire Pension Fund was considered by this Committee on 23 June 2025.
4.2 Forvis Mazars have been working with officers on the audit of the North Yorkshire Council 2024/25 SOFA from July 2025. The audit of both the North Yorkshire Council and North Yorkshire Pension Fund accounts is substantially complete, as per the draft Audit Completion Report to be presented to the Committee. Forvis Mazars have advised that there are currently no matters of which they are aware that would require modification of their audit opinion, subject to the satisfactory resolution of the outstanding matters.
Harbours Accounts
4.3 The accounts of both Whitby and Scarborough Harbours have been subject to further work following the Court Judgement issued in March 2025. Council members have been separately briefed on the judgement,
4.4 Since the draft accounts were published there have been further queries and objections raised and officers have been working to investigate and clarify the associated matters. In order to provide a reasonable assessment of the historic implications of the court judgement on both harbours, and the potential risk of material misstatement of the harbour reserves, further work to extrapolate historic balances has been undertaken.
4.5 This work has been considerable, and of necessity, has had to rely on incomplete records, applying reasonable judgement and estimates based upon the latest available data and information along with the historic records available. To this end further adjustments have been made to harbour reserves – taking the closing balances as at 31 March 2025 to £18.5m and £3.5m respectively. It is stressed that these adjustments are estimates based on the data available and include contingencies to provide assurance that, as far as is reasonably practicable, and thereby mitigating any residual risk of material misstatement, the accounts present a true and fair view.
Assurance and Audit Opinion
4.6 As a result of the legislative backstop arrangements introduced by the amendments to the Accounts and Audit Regulations 2015, Forvis Mazars were unable to complete the NYC 2023/24 audit in advance of the backstop date of 28 February 2025. The backstop arrangements limited Forvis Mazars’ ability to perform required audit procedures on the Council’s opening balances to form an opinion on the financial statements. As a result, Forvis Mazars issued a disclaimed opinion on the NYC 2023/24 SOFA.
4.7 In order to issue an unmodified audit opinion for 2024/25 Forvis Mazars are required to take steps to rebuild assurance in line with guidance issued by the National Audit Office. However, as highlighted in the North Yorkshire Council Audit Completion Report, Forvis Mazars have advised that due to implications of the NAO’s Local Audit Reset and Recovery Implementation Guidance they will not be able to obtain sufficient audit evidence for an unmodified opinion in the time available before the February backstop date. As a result, Forvis Mazars intend to issue a disclaimed audit opinion on the Council’s 2024/25 accounts overall.
5.0 APPROVAL OF FINAL SOFA
5.1 As the audit of the accounts is not yet finalised, the proposal to conclude the Final Accounts process, is for Members to approve the Final SOFA as it stands and delegate authority to the Chairman and Section 151 Officer to sign the accounts on behalf of the Audit Committee on completion of the audit, subject to no material matters arising.
5.2 Should a material change be needed then the updated SOFA would be brought back to the Audit Committee for further consideration and ultimate approval following audit completion and prior to the 27 February 2026 backstop date.
Letters of Representation
5.3 The External Auditor requires a written representation from the Council’s management as an acknowledgement of its responsibility for the fair presentation of the SOFA and as audit evidence on matters material to the financial statements. There are Management Letters of Representation for both the Council and North Yorkshire Pension Fund attached as Appendix A.1 and Appendix A.2 respectively. Members are asked to consider and approve the letter and authorise the Chairman and Corporate Director Resources to sign the letter on their behalf. The Letter will then be submitted to the External Auditor once signed.
Annual Governance Statement
5.4 The Annual Governance Statement (AGS), which is incorporated in the Statement of Accounts, is an annual report which assesses the effectiveness of the governance processes which have been put in place within the Council. The Audit Committee considered a draft AGS at its meeting on 23 June 2025 and changes have subsequently been actioned along with completion of sections 7 & 8 following a further review by officers The Audit Committee is therefore requested to formally approve the AGS 2024/25.
Statement of Accounts
5.5 The audited final SOFA is attached as Appendix C. A number of changes have been made to the SOFA since it was considered by this Committee on 23 June 2025. These changes are explained in detail in Appendix B attached and arise from:
i) changes agreed with the External Auditor during their audit of the accounts;
ii) internally initiated refinements together with those resulting from comments and questions by Members of this Committee and the Corporate Governance Working Group;
iii) inclusion of the External Auditor’s certificate which was not included in the draft SOFA (the audit certificate is currently awaiting finalisation from Mazars and confirmation will follow).
5.6 Members are therefore asked to approve the SOFA for 2024/25 and subject to no further material audit changes, authorise the Chairman and Corporate Director Resources to sign the accounts on behalf of the Audit Committee.
6.0 Corporate Governance Working Group
6.1 The Corporate Governance Working Group met on Monday 6 October to consider the North Yorkshire Council SOFA, AGS and draft Audit Report. A report from the Working Group is included on this agenda.
7.0 ALTERNATIVE OPTIONS CONSIDERED
7.1 No alternative options were considered.
8.0 FINANCIAL IMPLICATIONS
8.1 There are no specific financial implications.
9.0 LEGAL IMPLICATIONS
9.1 There are no specific legal implications.
10.0 EQUALITIES IMPLICATIONS
10.1 There are no equalities implications.
11.0 CLIMATE CHANGE IMPLICATIONS
11.1 There are no climate change implications.
12.0 REASONS FOR RECOMMENDATIONS
12.1 Member approval is required to sign off the audited SOFA in order to fulfil the obligations of those charged with the council’s governance (i.e. the Audit Committee).
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12.0 |
RECOMMENDATIONS
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12.1
12.2
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That Members authorise the Corporate Director Resources to sign the Letters of Representation as set out in paragraph 5.3 and Appendix A.1 and Appendix A.2 on behalf of the Audit Committee.
That in relation to NYC’s Statement of Final Accounts (SOFA) 2024/25:
(i) Members note the changes to the SOFA as set out in paragraph 4.2 and Appendix B (ii) Members approve the SOFA for 2024/25 (paragraph 5.6); and (iii) Subject to no further material changes arising from the audit, delegate authority to the Chairman, Chief Executive and Corporate Director Resources to sign the Statement of Responsibilities for the Statement of Accounts as attached at Appendix C
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APPENDICES:
Appendix A.1 – Management Letter of Representation – North Yorkshire Council
Appendix A.2 – Management Letter of Representation – North Yorkshire Pension Fund
Appendix B – Changes to the NYC 2024/25 Statement of Accounts since June 2025 Audit Committee
Appendix C – NYC Statement of Accounts 2024/25
BACKGROUND DOCUMENTS:
CIPFA Code of Practice on Local Authority Accounting in the United Kingdom 2024/25
Gary Fielding
Corporate Director – Resources
County Hall
Northallerton
December 2025
Report Author – John Raine Head of Corporate and Technical Finance
Note: Members are invited to contact the author in advance of the meeting with any detailed questions.