Meeting documents

Audit Committee
Tuesday, 9th December, 2008 7.00 pm

Date:
Tuesday, 9th December, 2008
Time:
7.00pm
Place:
Town Hall, Bury
 

Attendance Details

Present:
Councillor S P Penketh (in the Chair);
Councillors I Ahmed, K Audin, A J Garner, J Harris, A K Matthews
Co-opted:
A Loynes (Independent Member)

No members of the public attended the meeting
Apologies for absence:
Councillors K Rothwell, M J Wiseman and S Hurst
Buttons
Item Description Decision
Open
AU.495 DECLARATIONS OF INTEREST
 There were no declarations of interest made at the meeting.
AU.496 PUBLIC QUESTION TIME
 There were no members of the public present to ask questions at the meeting.
AU.497 Minutes of the Meeting held on Tuesday, 23rd September, 2008 7.00pm
 Delegated decision:

That the Minutes of the meeting of the Audit Committee held on 23 September 2008 be approved as a correct record and signed by the Chair.
AU.498 TRAINING - TREASURY MANAGEMENT
Preamble for item AU.498
Delegated decision:

That the Director of Finance and E-Government be thanked for his informative presentation.
AU.499 QUARTERLY REVIEW OF GOVERNANCE STATEMENT
Preamble for item AU.499
Delegated decision:

1. That the contents of the report be noted.

2. That the Audit Committee would continue to receive updates on a quarterly basis.
AU.500 FINANCE AND PERFORMANCE MONITORING 2008/2009 - MONTH 6
Preamble for item AU.500
Delegated decision:

1. That the Director be thanked for his informative report.

2. That the Executive Director of Adult Care Services be invited to attend the next meeting of the Audit Committee to report on the budget pressures facing the department.
AU.501 ETHICAL GOVERNANCE SURVEY RESULTS
Preamble for item AU.501
Delegated Decisions:

1. That the action plan at Appendix A be accepted.

2. That the training methodology at Appendix B be accepted

3. That the survey be repeated for Members in 2009/2010 and for Officers in 2010/2011 to assess the effectiveness of the training.
AU.502 EXTERNAL AUDIT PROGRESS 2007/2008
Preamble for item AU.502
Delegated decision:

That the contents of the report be noted.
AU.503 EXTERNAL AUDIT PROGRESS REPORT 2008/2009
Preamble for item AU.503
Delegated decisions:

That the contents of the report be noted.
AU.504 EXTERNAL AUDIT DATA QUALITY REPORT
Preamble for item AU.504
Delegated decision:

1. That the report be received

2. That the Head of Improvement be invited to the next meeting of the Audit Committee to explain the work being carried out to ensure that the authority maintains or improves on its score.
AU.505 EXTERNAL AUDIT USE OF RESOURCES JUDGEMENT
Preamble for item AU.505
Delegated decision:

1. That the contents of the report be noted

2. That KPMG be thanked for the professional way in which they worked with the Council in carrying out the assessment.
AU.506 OTHER BUSINESS
Preamble for item AU.506
Delegated decision:

That all the reports presented to the next meeting of the Audit Committee be written using Plain English guidance.
AU.507 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.
Exempt
AU.508 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.509 INTERNAL AUDIT REPORT - MEMBERS' FEEDBACK
  • (Attachment: 17)A report from the Head of Internal Audit
  
The meeting started at 7.00 pm and ended at 8.30 pm

Preamble

Preamble
ItemPreamble
AU.498The Director of Finance and E-Government gave a PowerPoint presentation explaining Local Government Treasury Management.

The presentation set out investments, the approach to investing and the current position of the authority’s investments.

Also covered within the presentation was the authority’s approach to managing debt.

Members of the Committee were given the opportunity to ask questions on the information provided and the following comments were raised:-

• Councillor Penketh stated that the authority had made a steady profit whilst minimising the risks they had taken when investing. He felt that this should be recognised by the Audit Committee as good practice.

• Councillor Matthews enquired as to whether the authority received a ‘safe list’ from the Treasury. It was explained that the Treasury no longer issued a safe list.

• A number of questions were raised regarding the current financial climate and the forecasts for the future and it was explained that the authority monitored its investments and loans closely and regularly to ensure that if anything of concern were to happen, action could be taken quickly.
AU.499The Head of Internal Audit presented a report updating Members on the effectiveness of the Authority’s internal control and risk management systems. The report detailed the continuous monitoring that was carried out and highlighted any relevant issues.

It was explained that the arrangements to revise the Risk Registers at both Departmental and Corporate levels were firmly in place with reviews being undertaken each quarter for the previous two years.

Work was continuing in developing the Council’s approach to risk management in areas such as risk registers in respect of partnership working.

It was also explained that the current approach would be reviewed in 2009 with the aim of integrating risk management further into the day to day management and decision making processes of the Council.

The work of Internal Audit was explained and it was reported that the section produced reports which ranked recommendations according to urgency with the highest category being red. During the current Audit year, no recommendations had fallen into that category with 172 being made since the previous Committee update.

A Governance Panel had been established and had prepared an action plan in response to the findings of the review of ethical governance which had covered a range of senior officers and Elected Members.

The report also highlighted issues relating to budget monitoring, the implementation of the local pay agreement, the Use of Resource Judgement and systems for declaring interests and offers of gifts and hospitality.

No significant control weaknesses had been identified in the year to date.
AU.500The Director of Finance and E-Government presented a report updating Members of this 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 indicated that the Authority was projecting an overspend of £1.251m for the year based on spending and income information as at 30 September 2008. This projected overspending was regarded as a matter of concern, however, it could be accommodated within the General Fund balances without breaching the ‘Golden Rules’, as a consequence of which, the estimated position was not seen as a major risk to the achievements of the Authority’s Ambitions and Priorities.

The critical budget pressure areas were identified as Learning Disability Services, Leisure Services and Land Charges income for which monitoring action plans had been put in place to bring these budgets under control. It was acknowledged that the overspendings in these areas may not be eradicated in the current year.
AU.501The Head of Internal Audit presented a report from the Ethical Governance Panel setting out the results of the 2007/2008 Ethical Governance Survey and the proposed action plan resulting from that survey.

It was explained that the survey had been sent to 1004 Council officers on SCP 29 and above and to 51 Elected Members. The responses received gave an indication that there were areas for which work was required to promote ethical governance within the Authority.

Appended to the report was a table giving detailed responses to the questions and highlighting the areas that required urgent attention.

Also appended to the report was a set of training proposals which if carried out would improve awareness on the areas of weakness which had been highlighted.

It was anticipated that rolling out of the training programme would commence on 31 January 2009 with repeat surveys being carried out for Elected Members in 2009/2010 and Officer in 2010/2011.
AU.502Heather Garrett from KPMG submitted a report setting out the work that had been completed by KPMG in accordance with their 2007/2008 Audit Plan.
AU.503Heather Garrett from KPMG presented a report updating Members on the ongoing work of KPMG.

Heather reported that the Capital Programme Management work would be presented to the Audit Committee at its next meeting.

AU.504Leanne Burnett representing KPMG presented a report setting out the results of a review of the authority’s data quality.

It was explained that the work was structured around five key themes:-

• Governance and leadership;
• Policies and procedures
• Systems and processes
• People and skills; and
• Data use and reporting

The five themes were then broken down into thirteen Key Lines of Enquiry (KLOEs). The arrangements against each KLOE was assessed and the scores were set out within the report

The authority’s performance was assessed as performing well over all five themes.

Appended to the report was a table setting out the recommendations and the management response to those recommendations.

Members of the Committee asked questions of the report and commented on the need to maintain the levels currently set. Questions were also raised regarding the issue of partnership working. It was suggested that an officer from the Performance Team attend the next meeting to explain how to maintain/build on the score of 3 out of 4.
AU.505Heather Garrett representing KPMG presented a report setting out the findings of the annual Use of Resources assessment which evaluates how the Council manages and uses its financial resources. The assessment focussed on the importance of having sound and strategic financial management in order to ensure that resources were available to support the Council’s priorities and improve services.

The assessment covered the following five themes:-

• Financial reporting;
• Financial management;
• Financial standing;
• Internal control; and
• Value for money

It was reported that the overall score for the Use of Resources assessment was 3, which shows that the Council was performing well.

Detailed findings were included within the report, along with areas for further development which would be drawn into an action plan to reflect the Use of Resources assessment for 2009.

It was also explained that the Use of Resources assessment would be revised for the next financial year.
AU.506Members commented on the way that Council reports and literature were written. It was stated that it was sometimes difficult to follow the reports as they contained acronyms and jargon which could be hard to understand.