Meeting documents

Audit Committee
Tuesday, 20th February, 2007 7.00 pm

Date:
Tuesday, 20th February, 2007
Time:
7.00pm
Place:
Meeting Room A & B, Town Hall, Bury
 

Attendance Details

Present:
Councillor E B Briggs (in the Chair);
Councillors D Ashworth, K Audin, Y Creswell, D O’Hanlon, K Rothwell and B Vincent.
Co-opted:
No members of the public attended the meeting
Apologies for absence:
Councillors, P Ashworth (CL) and A Matthews (CL) Mr K Wainwright (Co-Opted Member)
Buttons
Item Description Decision
Open
AU.1008 DECLARATIONS OF INTEREST
 There were no declarations of interest made the meeting.
AU.1009 PUBLIC QUESTION TIME
 There were no members of the public present to ask questions at the meeting.
AU.1010 Minutes of the Meeting held on Tuesday, 12th December, 2006 7.00pm
 Delegated decision:

That the minutes of the meeting held on 12 December 2006 be approved as a correct record and signed by the Chair.
AU.1011 2007/2008 EXTERNAL AUDIT AND INSPECTION PLAN
Preamble for item AU.1011
Delegated decision:

1. That the contents of the report be noted.

2. That Members consider items to be included in the External Audit and Inspection Plan and forward any suggestions to Rashpal Khangura.
AU.1012 AUDIT COMMITTEE TRAINING SESSION - EFFICIENCY STRATEGY
Preamble for item AU.1012
Delegated decision:

That the contents of the session be noted
AU.1013 BVPI'S AND NON BVPI'S ISSUES GRID
Preamble for item AU.1013
Delegated decision:

That the contents of the report be noted.
AU.1014 BVPP AUDITOR'S REPORT

Preamble for item AU.1014
Delegated decision:

1.That the improvement from a score of two to three be noted.

2.That the contents of the report be noted.

AU.1015 2006/2007 EXTERNAL AUDIT PROGRESS REPORT
Preamble for item AU.1015
Delegated decision:

That the contents of the report be noted.
AU.1016 FINANCIAL & PERFORMANCE MONITORING REPORT

Preamble for item AU.1016
Delegated decision:

1.That the contents of the report be noted

2.That the Audit Committee undertakes a review of the effectiveness of the Executive in the area of Financial Monitoring and Performance.
AU.1017 RECONCILIATIONS UP-DATE
Preamble for item AU.1017
Delegated decision:

1That the contents of the report be noted

2. That the staff within financial services be commended for their hard work in this area.
AU.1018 STATEMENT ON INTERNAL CONTROL - UPDATE
Preamble for item AU.1018
Delegated decision:

1. That the contents of the report be noted.

2. That the approach outlined in the report be endorsed.
AU.1019 EXCLUSION OF PRESS AND PUBLIC
Delegated decision:

That in accordance with Section 100(A)(4) of the Local Government Act 1972, the press and public be excluded from the meeting during consideration of the following items of business since they involved the likely disclosure of exempt information relating to any action taken, or to be taken in connection with the prevention, investigation and prosecution of crime.
AU.1020 JIM BUTTERWORTH - RETIREMENT
Preamble for item AU.1020
Delegated decision:

That the Committee, on behalf of the Council thank Jim Butterworth for his input, assistance and hard work over the years.
Exempt
AU.1021 INTERNAL AUDIT ANNUAL PLAN
  • (Attachment: 8)A report from the Head of Internal Audit
  • |
    (Attachment: 9)Appendix A
  • |
    (Attachment: 10)Appendix B
  • |
    (Attachment: 11)Appendix C
 
AU.1022 INTERNAL AUDIT PROGRESS REPORT
  • (Attachment: 12)A report from the Head of Internal Audit
  • |
    (Attachment: 13)Appendix A
  • |
    (Attachment: 14)Appendix B
  • |
    (Attachment: 15)Appendix C
  • |
    (Attachment: 16)Appendix D
 
AU.1023 INTERNAL AUDIT REPORTS - MEMBERS' FEEDBACK

  • (Attachment: 17)A report from the Head of Internal Audit
  
The meeting started at 7.00 pm and ended at 9.45 pm

Preamble

Preamble
ItemPreamble
AU.1011Rashpal Khangura, Audit Manager at KPMG, explained that the External Auditors were in the process of preparing their Audit Plan and Inspection Plan for the forthcoming year. Rashpal reported that the final Plan would be brought to the next meeting of this Committee on 19 April for comment and approval.

The External Auditors had met with relevant officers within the Authority and had considered areas that would be covered within the Plan. The following four issues had been highlighted as risk issues and it was proposed that they be included within the Plan:

- Local Area Agreement
- Local Strategic Partnership
- Joint Ventures
- Service Prioritisation

It was explained that this was the first step in the consultation process and the Draft Plan would be circulated to Members for their comments prior to the April meeting.

Rashpal introduced James Foster, Relationships Manager with the Audit Commission.

James explained that the Audit Commission had undertaken three pieces of work across Greater Manchester researching the following crosscutting issues:-

- Health and Inequalities
- Placement of Children
- Social Needs Transport

It was explained that the work carried out relating to the three topics had highlighted areas where more work was required but also areas of good practice and joint working. The agencies that had been involved with the work had been co-operative and supportive and had given good feedback on the process and outcome.
AU.1012Steve Kenyon, Head of Strategic Finance, gave the members of the Audit Committee a training session giving an overview of the Authority’s Efficiency Strategy. It was explained that the Council’s costs were the second lowest of its nearest CIPFA neighbours with total costs 9% below the average.

The purpose of the Efficiency Strategy was explained as the following:-

- To promote clear understanding of efficiency across the organisation.
- To demonstrate clear ownership of efficiency.
- To outline a systematic approach to identifying efficiency gains.
- To incorporate efficiency within corporate/service planning process.
- To develop mechanism to identify, monitor and report efficiency gains.

The Authority’s definition of efficiency was explained as:-

“The production of the desired effects or results with the minimum waste of time, money or effort”.

Steve explained the context of the Strategy, gave examples of efficiency, the approaches current and new, links to other Council strategies and the roles and responsibilities of all employees and Members.

It was explained that there would be briefings for both staff and Members and the Strategy would be available on the Council intranet site, within the Service Plans, Metro Matters and payslips.

Members were given the opportunity to ask questions and make comment.
AU.1013Rashpal Khangura presented a report setting out the Best Value Performance Indicators and Non-Best Value Performance Indicators issues grid. The grid highlighted amendments, reasons for those amendments and the significance of the issues.
AU.1014The External Auditor submitted a report certifying that they had audited the Best Value Performance Plan of the Authority in accordance with Section 7 of the Local Government Act 1999 and the Audit Commission’s Code of Practice.


It was reported that KPMG was required to recommend whether the Audit Commission should carry out a Best Value inspection of Bury MBC under Section 10 of the Local Government Act 1999 and whether the Secretary of State should give a Direction under Section 15 of the 1999 Act.

The External Auditors reported that on the basis of their work, they did not recommend either of the actions.
AU.1015Rashpal Khangura from KPMG submitted a report summarising the ongoing work of KPMG.
AU.1016The Director of Finance and E-Government submitted a report updating the Committee on the Authority’s financial and performance position in line with the
Committee’s Statement of Purpose to ‘provide independent scrutiny of the Authority’s financial and non-financial performance to the extent that it affects the Authority’s exposure to risk and weakens the control environment’.

The report showed that the Authority was performing well and the financial position at the end of December 2006 was satisfactory.

AU.1017The Director of Finance and E-Government submitted a report updating the Committee on the progress with the bank and feeder system reconciliations.

It was reported that the latest position was as follows:-

- Accounts payable - complete to the end of January 2007; all reconciling adjustments resolved
- Accounts receivable - complete to the end of January 2007; all reconciling adjustments resolved
- Trent (payroll) to Agresso - complete to the end of January 2007; all reconciling adjustments resolved
- Cash receipts to Agresso - complete up to end of January 2007, all reconciling adjustments resolved. Being done daily on an ongoing basis
-Payments Bank Reconciliation: this is up-to-date and being done regularly on an ongoing basis.
- Income Bank Reconciliation - completed to the end of October, resources re-directed to assist in catching up but no issues anticipated. The system changes needed to allow automation of this process within Agresso had been implemented and were awaiting testing.
- All outstanding issues relating to the brought-forward of balances from 2005/2006 appeared to have been resolved
- Reconciliation of the bank figure within the Trial Balance against the bank statement to be completed by the end of February 2007.
AU.1018The Director of Finance and E-Government submitted a report giving an explanation and update on the continuous work being carried out on the review and effectiveness of the Authority’s Internal Control and Risk Management systems.

It was explained that the Authority had set out a number of actions which would be implemented, in line with the recommended guidance.

The reported actions include:-

- The establishment of Challenge Panel to review and approve the 2006/2007 Statement on Internal Control (SIC). The Panel will be independent from the Audit Committee.

- To carry out a continuous review with quarterly reports to the Management Board and Audit Committee.

- Actions plans to be produced as necessary and monitored by the Management Board and Audit Committee.

- A Certificate to be produced and signed by the Leader of the Council, Chief Executive, Directors and the Head of Internal Audit. The Certificate will outline their roles in the framework, give an opinion of the adequacy of controls in their relevant area and their role in SIC process.

A chart setting out the process of preparation of the SIC was included in the report.

It was reported that the Authority would be required to produce its next Statement to accompany the 2006/2007 Statement of Accounts (as at 31 March 2007). The Statement will then be reviewed on a quarterly basis and reported to Management Board and the Audit Committee.
AU.1020The Chair reported that this meeting would be the last Audit Committee that Jim Butterworth would be attending due to his retirement at the end of March.

Jim was thanked for his hard work and input over the years that he had been involved with the Audit Committee. The Committee wished him a long and happy retirement.