Agenda and draft minutes

Audit & Governance Committee - Tuesday 25th February 2020 6.00 pm

Venue: Gipping Room, Grafton House

Contact: Jess Dool  01473 432513

Items
No. Item

31.

Appointment of Vice-Chair

Minutes:

Resolved:

 

that Councillor A Rae be elected as Vice-Chair of the Audit & Governance Committee for the remainder of the municipal year.

32.

Apologies for Absence

Minutes:

Apologies for Absence were received from Councillor Maguire.

33.

Unconfirmed Minutes of the Previous Meeting held on 17 September 2019 pdf icon PDF 304 KB

Minutes:

Resolved:

 

that the Minutes of the Meeting held on 17 September 2019 be signed as a true record.

34.

To Confirm or Vary the Order of Business

Minutes:

Resolved:

 

that the Order of Business be as printed on the Agenda.

35.

Declarations of Interest

Minutes:

There were no Declarations of Interest.

36.

AG/19/17 External Audit - Annual Audit Letter for The Year Ended 31 March 2019 pdf icon PDF 103 KB

Additional documents:

Minutes:

36.1.    Ms Debbie Hanson, External Auditor, outlined the key points of the Annual Audit Letter for the Year Ended 31 March 2019 and confirmed that an unqualified opinion had been concluded with the certificate issued on the 14 August 2019 in accordance with this. 

 

36.2.    Ms Hanson confirmed that an additional Audit had been undertaken in 2018/19 with regards to the risks identified in relation to the statement of accounts and the value for money conclusion, the implementation of the new payroll system and the full valuation of Council non-current assets.

 

36.3.    Councillor Phillips asked if the fee for the errors identified for Housing Benefits certifications (between £1,000 and £4,000) could be narrowed down to provide a more precise figure. Ms Hanson advised that the tender document would need to be considered to do this however, sample testing had been undertaken in this area and depending on the complexity of the error, further discussion would take place with the Housing Benefit provider and Ipswich Borough Council to consider the nature of the errors and categorise whether they would be a lower or higher fee. Previously, a certification report would have been considered by the Committee however this was no longer a requirement and a report would only be brought to the Committee should there be significant issues.

 

Resolved:

 

that the Annual Audit Letter for the Year Ended 31 March 2019 be noted.

37.

AG/19/18 External Audit Plan 2019/20 pdf icon PDF 102 KB

Additional documents:

Minutes:

37.1.    Ms Hanson presented the provisional External Audit Plan 2019/20 and confirmed that there had been a slight delay to the current timetable.

 

37.2.    All identified risks had been included in the plan, including the specific risk in relation to the inappropriate capitalisation of revenue expenditure statutes, which had been identified amongst a number of Councils.

 

37.3.    There had been particular focus in 2018/19 on the Valuation of Land and Buildings and Investment Property Assets following the Council’s full evaluation of assets and the significant purchase of the proposed Retail Park. Although a full evaluation would not be undertaken in this area for 2019/20, property valuations would always be identified within the plan as high risk, due to the judgements in estimates made and potential impact on accounts.

 

37.4.    The Audit approach had been carefully set out and other areas of audit focus had been identified including the new accounting standard, which although had been deferred until 2021, required disclosures to be made in 2019/20 with regards to the potential impact this could have. The Council would be required to identify all leases and re-assess these as per the new standard and it was confirmed that consideration of this had begun.

 

37.5.    Ms Hanson confirmed that full scopes would be undertaken on all audits to ensure sufficient procedures had been undertaken in order to obtain assurances. It was confirmed that alternative auditors undertook both Ipswich Assets and Ipswich Busses audits and assurances from them would be sought by Ernst & Young LLP.

 

37.6.    Councillor Phillips asked if there was any concern regarding the delay to the timetable. Ms Hanson confirmed that following discussions with other firms involved with public sector audit and CIPFA etc. pressures of the timetable had been acknowledged by all. It was advised that there was no statutory deadline or late penalty fees for the audit opinion and that this could only be issued once there had been sufficient assurance and work undertaken.

 

Resolved:

 

that the External Audit Plan 2019/20 be noted.

38.

AG/19/19 Financial Management and Control Corporate Budget Monitoring 2019/20 Quarter 2 pdf icon PDF 977 KB

Minutes:

38.1.    Mr John Chance, Head of Finance and Revenues, presented the Financial Management and Control Corporate Budget Monitoring 2019/20 Quarter 2 report and confirmed that this had been delayed following the cancellation of the Audit & Governance Committee in December 2019 due to the General Election.

 

38.2.    The Chair requested further information with regards to ‘My Community Space’ and whether any investigations had been undertaken and Councillor Fisher asked if assurances could be given that attempts had been made to reclaim the monies owed to the Council following the High Court decision made in February 2018 and the charity’s dissolvement in July 2019. Mr Chance agreed to follow both questions up after the meeting.

Action: Mr Chance, Head of Finance and Revenues, to provide further information regarding ‘My Community Space’ and assurances that attempts had been made to reclaim the monies owed to the Council.

 

38.3.    Councillor Grant asked if the landlord of St Clare House was now responsible for the payment of empty building business rates and Mr Chance agreed to confirm this after the meeting.

Action: Mr Chance, Head of Finance and Revenues, to confirm if the landlord for the building would now be responsible for the payment of empty building business rates.

 

38.4.    Councillor Fisher asked for clarification with regards to the estimated increase of £200,000 in electricity costs and the proportion of this against the annual spend on electricity. Mr Chance confirmed that currently the Council spent approximately £1.5m on utilities which included gas and water, therefore a £200,000 variance would be a fairly low proportion of this however, further information would be sought after the meeting.

Action: Mr Chance, Head of Finance and Revenues, to provide further information regarding the £200,000 estimated increase in electricity costs including the percentage of this against the annual spend, what the Council had previously paid toward electricity and how much would be paid toward electricity now.

 

Resolved:

 

that the Financial Management and Control Corporate Budget Monitoring 2019/20 Quarter 2 be noted.

39.

AG/19/20 Treasury Management Review & Performance Update 2019/20 pdf icon PDF 241 KB

Minutes:

Resolved:

 

that the Treasury Management Operations for the period 1 April 2019 to 30 September 2019 be noted.

40.

AG/19/21 Write-Offs of Bad Debts 1 April 2018 - 31 March 2019 pdf icon PDF 355 KB

Minutes:

40.1.    Councillor Fisher commented that it had been positive to note the improved performance in this area and congratulated the team for their efforts.

 

Resolved:

 

that the sums written-off under Financial Standing Orders, in the period 1 April 2018 – 31 March 2019 amounting to £1,084,058 be noted.

41.

AG/19/22 Standards Update (Councillor Code of Conduct Matters) pdf icon PDF 297 KB

Minutes:

41.1.    Ms Shirley Jarlett, Head of Governance, presented the Standards Update report and confirmed that there had been very few complaints made against Councillors within the last year, of which none had required a full investigation and all had related to the use of social media.

 

41.2.    In January 2019 the Committee on Standards in Public Life had published a report with recommendations regarding changes to the Code of Conduct however, this had stalled due to other high priorities. The Local Government Association had since announced in September 2019 that they would be re-issuing a new model Code of Conduct which would be consulted on from 16 March 2020. It was agreed that this would be circulated to the Chair of the Audit & Governance Committee and all Group Leaders for comments.

 

 

Resolved:

 

that the report be noted.

42.

AG/19/23 Corporate Anti-Fraud Business Plan 2020/21 pdf icon PDF 295 KB

Additional documents:

Minutes:

42.1.    Ms Siobhan Martin, Head of Audit, presented the Corporate Anti-Fraud Business Plan 2020/21 and confirmed that the Council had a zero-tolerance approach to fraud and a number of ways available for fraud to be reported – such as the fraud hotline and dedicated email. The business plan had been based on international and national guidance with input from a number of agencies.

 

42.2.    The Fraud Team at Ipswich Borough Council was a small and highly trained team equivalent to 3.4 FTE. The team fundamentally considered three areas: acknowledgment that fraud existed, preventative work and prosecution.

 

42.3.    It was confirmed that tenancy fraud remained a key focus and was nationally recognised as the main area of fraud challenge for Local Authority’s. 

 

Resolved:

 

that the Corporate Anti-Fraud Business Plan 2020-21 be endorsed.

 

Resolved:

 

that the Corporate Anti-Fraud Business Plan 2020-21 be endorsed.

43.

AG/19/24 Internal Audit - Charter Refresh pdf icon PDF 438 KB

Minutes:

43.1.    Ms Martin, Head of Audit, confirmed that two minor amendments had been made to the Charter following the recent refresh:

·         That any operational duties performed by the team be clearly stated;

·         That any work performed for any external organisation be agreed in writing and clearly stated.

 

Resolved:

 

that the refreshed internal Audit Charter attached at Appendix 1 be approved.

44.

AG/19/25 Internal Audit - Annual Audit Plan 2020/21 pdf icon PDF 377 KB

Additional documents:

Minutes:

44.1.    Ms Martin, Head of Audit, presented the Strategic Internal Audit Plan 2020/21. The current structure of the Internal Audit Service was equivalent to 4.5 FTE and with the resources available, 705 productive audit days had been programmed for 2020-21.

 

44.2.    There were a number of factors and drivers which were used to formulate the Audit Plan including the Corporate Plan, Council Decisions and Performance. Meetings would be held with the Head of Internal Audit and Senior officers to develop assurance maps for each service area and to identify any issues or emerging risks which the Council may seek to gain assurance over.

 

44.3.    Ms Martin confirmed that although a programme of work had been planned for 2020-21, should any areas of concern be identified during this time, there would be flexibility within the plan to consider those. 

 

Resolved:

 

that the Internal Audit – Strategic Annual Plan for 2020-21 attached at Appendix 1 be approved.

45.

AG/19/26 Internal Audit - Recently Issued Reports pdf icon PDF 210 KB

Additional documents:

Minutes:

45.1.    Councillor Fisher asked for clarification over the implementation dates in the Payroll Report. Ms Martin confirmed that when an area had been classified as ‘low risk’, Officers would be provided more time to complete the action whereas ‘high risk’ areas required immediate consideration. With regards to the specific areas highlighted by Councillor Fisher, Ms Martin agreed to discuss this with the relevant officers.

 

Resolved:

 

that the Audit & Governance Committee note the following Audit Reports:

 

1.    Payroll 2018-19 [FR004]

2.    Risk Management [CC017]

3.    IHMS ICT Key Controls [HCS039]

4.    Homelessness [HCS035]

5.    Disabled Facilities Grant [HCS048]

6.    Housing Rents 2018-19 [HCS029]

7.    Houses of Multiple Occupation [HCS049]

46.

AG/19/27 Audit & Governance Committee - Future Work Programme pdf icon PDF 24 KB

Additional documents:

Minutes:

46.1.    It was agreed that the standing item ‘Internal Audit Status of Recommendations’ be added to the September and March meetings.

 

Resolved:

 

that the Audit & Governance Committee Future Work Programme 2020/21 be noted.

47.

Exclusion of Public

To consider excluding the public (including the Press) from the meeting during consideration of the following items under Section 100 (A) of the Local Government Act 1972 as it is likely that if members of the public were present during that item there would be disclosure to them of exempt information as defined within paragraphs 3 & 4 of Part 1 of Schedule 12A of the Act.

Minutes:

Resolved:

 

that the public (including the Press) be excluded from the meeting during consideration of the remaining items under Section 100 (A) of the Local Government Act 1972 as it was likely that if members of the public were present during these items, there would be disclosure to them of exempt information as defined within paragraphs 3 & 4 of Part 1 of Schedule 12A of the Act.

48.

Unconfirmed Exempt Minutes of the Meeting held on 17 September 2019

49.

AG/19/28 Internal Audit - Exempt Recently Issued Reports

50.

AG/19/29 Internal Audit - Status of Recommendations and Implementation of High Priority Recommendations

51.

AG/19/30 Internal Audit - Public Sector Internal Audit Statement External Assessment