The Lancashire County Council's Audit, Risk and Governance Committee met on 21 July 2025, to discuss the statement of accounts, external audit plans, treasury management, procurement and internal audit reports. The committee was asked to approve the Internal Audit Charter and Mandate and the Internal Audit Strategy 2025–2028, and to consider and comment on the other reports.

• Councillor County Hannah Whalley was appointed as Chair and Councillor County Rick Edwards as Deputy Chair of the Audit, Risk and Governance Committee for the 2025-26 municipal year.

• The committee reviewed the Statement of Accounts 2024/25, noting the commencement of the external audit. The statement included accounts for Lancashire County Council and the Lancashire County Pension Fund. Key changes from the previous year included the removal of around £880 million in school assets following a change in accounting policy, and an overspend against the Dedicated Schools Grant¹ of £40.847m.

• The committee reviewed the External Audit Plan 2024/25 from Grant Thornton, focusing on significant risks such as management override of controls, valuation of land and buildings, and valuation of the net pension asset. The audit plan summarised the proposed work around these risks.

• The committee also reviewed the Lancashire County Pension Fund External Audit Plan 2024/25, which highlighted key risk areas including management override of controls, valuation of level three investments², and valuation of directly held properties.

• The committee discussed the Treasury Management Activity 2024/25 and Strategy Update, which reviewed borrowing and investment activities, performance against budget, and compliance with prudential indicators. The report noted that the council had reduced its projected overspend position through effective financial replanning and management focus. Councillor County Mr Joel Michael Tetlow asked about investments made in December 2021, when interest rates were low and inflation was rising, and about investments in EDF, given volatility in the energy industry. Mike Jensen, Director of Investments, responded that the investments were made to protect the security of investments rather than to make a specific return.

• The committee considered the Procurement Waivers and Non-Compliance 2024-25 report, which provided an update on waivers granted under the procurement rules and any instances of non-compliance identified during the reporting period. Councillor County Paul Stubbins raised concerns about the strength of the council's basis for compliance with the Procurement Act 2023³.

• The committee reviewed the Internal Audit Annual Report 2024/25 and Progress Report, which summarised the work undertaken by the Internal Audit Service and key themes arising in relation to internal control, governance and risk management. The Head of Internal Audit provided a moderate assurance overall on the adequacy of the design and the effectiveness of the council's frameworks for governance, risk management, and internal control.

• The committee approved the Internal Audit Charter and Mandate, which establishes the framework within which Lancashire County Council's Internal Audit Service operates.

• The committee approved the Lancashire County Council Internal Audit Strategy 2025–2028, which provides a clear vision and direction for the council's internal audit function.

• The committee approved the updated Corporate Risk and Opportunity Register, which has been refreshed to reflect the council's current operating environment. Councillor County Paul Stubbins requested that officers review whether devolution and Local Government Reorganisation should be considered separately in future. Councillor County Mackenzie Ritson asked about the high costs of placements for children.

• Councillor County Paul Stubbins suggested that the committee should have a report on ombudsman complaints at the next meeting.