Issue - meetings

This report presents the Pension Fund Annual Report and audited Accounts for 2017/18 for the Committee and Board’s approval.  The annual audit report from the Fund’s external auditor BDO is also presented. 

Annex 1 BDO Audit Report (ISA 260) – to follow

The Committee and Board considered the Pension Fund Annual Report and audited Accounts for 2017/18 for the Committee and Board’s approval, presented by Thomas Skeen, Head of Pensions. The annual audit report from the Fund’s external auditor BDO was also presented. The Committee was referred to Annex 2 for the full contents of the report and the recommendations as shown at 3.1 – 3.3.

The Committee and Board was referred to the financial statements and notes in Appendix 1 which showed that the value of the Fund's assets increased by £48m to £1,356m as at 31 March 2018. During the year, the rate of return on the Fund’s investments was 4.40%. It was noted that this was 1.02% below the Fund’s target of 5.42% for the year, however, it was emphasised that when this target figure was compared with that of other funds, it actually performed higher than the average.

The external auditor, BDO, was present to give an update to the Committee on the audit that they carried out on the Council’s accounts. The auditor went through the pension fund accounts that has been prepared (Annex 2, Appendix 1). The auditor noted they were impressed with how the Pension team was carrying out the Council’s duties as administering authority for Haringey Pension Fund.

With regard to the future, the auditor noted that in looking at the cash balances and investment plans, there was a balance of £3.1 million, which Council Officers had treated as part of the investment portfolio in the accounts, whereas BDO took the view that this should be treated as a current asset.  BDO noted that this makes no bottom line difference to the value of the fund overall, but that this was noted in their audit report.

The auditor concluded stating that it was a thoroughly positive audit and that they were ready to sign on the pension fund account, however, would like it to be noted that there appeared to be some discrepancies in the actuaries sum and those presented by Haringey Council’s accounts.

The independent legal advisor, John Raisin, spoke to the Committee about the report that he had prepared on ‘Market Background 2017/18’ for the Committee and Board to consider. Amongst the significant events that affected the market during this time, were:

·         The United States Federal Reserve initiating a significant change of direction in monetary policy;

·         The unpredictability of current administration in the USA;

·         Japan continuing their quantitative easing programme;

·         Since the end of last year, emerging markets had performed well.

·         Due to the uncertainties surrounding the United Kingdom exiting the European Union, foreign investors were wary of investing in the United Kingdom.

With regard to cash balance, it was noted that the College of Enfield and Haringey was leaving the Fund imminently, which meant that approximately £40 million had to be made available to cover this transfer of pension funds. It was understood that this would now take place in September 2018, later than what was originally planned for. A further  ...  view the full minutes text for item 190