Agenda item

This paper has been prepared to update the Pensions Committee and Board on the Pension Fund’s risk register and provide an opportunity for the Pensions Committee and Board to further review the risk score allocation.

This report was prepared to update the Pensions Committee and Board on the pension fund's Risk Register and provide an opportunity to review the risk score allocation. The Haringey Risk Register was presented, as it is at every meeting, to allow members to assess the risks within the Fund and comment on the current risk allocation.

This version of the risk register focused primarily on governance risks. These risks were considered relatively stable, and no significant changes were made to the scoring. The reason for this was that the governance review, which would propose new recommendations, was set to be discussed later in the meeting. It was suggested that the new recommendations be incorporated into the risk register going forward, but no updates were made at that stage to avoid pre-empting the outcome of the review.

Additionally, key risks identified in Table 1 of Section 6.6 were highlighted, particularly the delay in the publication of the Statement of Accounts. It was noted that this issue was likely to improve, with a deadline for issuing an opinion on the previous year's accounts by December 13. Close collaboration with KPMG on the audit exercise was ongoing, and an update would be provided to the Committee and Board in the new year.

Other risks included significant volatility in financial markets, which would be discussed later during the investment performance item, and the ESG risk, which was being addressed through the responsible investment work. The Committee was invited to comment on the risk assessments and the mitigation measures in place.

Councillors raised queries about the expected completion date for KPMG's audit of the 2023-2024 accounts. It was confirmed that KPMG was expected to complete their fieldwork before Christmas. The deadline for reporting to the Audit Committee was set for February, but the report on the 2023-2024 pension fund accounts would be presented in January, as there was no Audit Committee meeting in February. The accounts would be approved in mid-January and then presented to the Pensions Committee in March for noting.

Regarding the previous year's accounts (2020-2021 to 2022-2023), the opinions from the previous auditors, BDO, would be reported to the Audit Committee at its next meeting, potentially concluding the work on those accounts. KPMG's work for 2023-2024 was well underway, with fieldwork expected to be completed before Christmas, and reporting to the Audit Committee on track for January.

In response to concerns raised, it was noted that no significant issues had been raised so far regarding the 2023-2024 pension fund accounts, although there were still a few weeks remaining. The work on previous years' accounts by BDO had been light, and no issues had been flagged in their report.

It was added that a potential flag might arise from the valuation of private markets investments, which was a common issue related to timing of production of the Net Asset Value (NAV) statements. Since the pension fund's accounts had to be completed using the most recent information from investment managers, discrepancies could arise after investment managers completed their own audits, which took about 120 days. This could lead to material misstatements, but it was expected that any discrepancies would be addressed in the post-audit version. Tim Mpofu confirmed that, so far, no concerns had been flagged by KPMG, but the final report would be presented to the Committee in the new year.

RESOLVED:

The report was noted by the Committee.