Agenda and minutes

Audit and Governance Committee - Monday, 5th December, 2016 6.00 pm

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Venue: Council Chamber, Town Hall, Royal Tunbridge Wells, TN1 1RS. View directions

Contact: Mike McGeary  Democratic Services Officer

Items
No. Item

AG37/16

Apologies for Absence

Apologies for absence as reported at the meeting.

Minutes:

Apologies for absence were reported from Councillor Moore.

AG38/16

Declarations of Interest

To receive any declarations of interest by members in items on the agenda.

 

For any advice on declarations of interest, please contact the Monitoring Officer.

Minutes:

There were no declarations of interest made, within the provisions of the Code of Conduct for Members.

AG39/16

Notification of Visiting Members wishing to speak (in accordance with Council Procedure Rule 18)

Members should indicate which item(s) they wish to speak on and the nature of their concern/question/request for clarification.

Minutes:

There were no other members of the Council who had registered their wish to address the Committee, within the provisions of Council Meetings Procedure Rule 18.

AG40/16

Minutes of the Previous Meeting pdf icon PDF 235 KB

The Chairman will move that the minutes of the previous meeting, dated 20 September 2016, be signed as a correct record. The only issue relating to the minutes which can be discussed is their accuracy.

 

In accordance with Council Meetings Procedure 16.1, the Chairman will sign the minutes of today’s proceedings at the next scheduled meeting.

Minutes:

The minutes of the meeting of the Audit and Governance Committee dated 20 September 2016 were submitted.

 

Councillor Podbury referred to minute AG32/16 – the Strategic Risk report – specifically the offer made by the Chief Executive to support those parish and town councils who wished to undertake their own local ward walks. She enquired what progress had been made in making this widely known to local council chairmen. Lee Colyer, the Director of Finance and Corporate Services, said that he would follow this matter up.

 

RESOLVED – That the minutes of the Audit and Governance Committee dated 20 September 2016 be approved as a correct record.

AG41/16

Update on Complaints Received Under the Members' Code of Conduct pdf icon PDF 135 KB

Minutes:

Estelle Culligan, the Interim Head of Legal Partnership and Monitoring Officer, presented an update report on complaints received under the authority’s Members’ Code of Conduct, for the period ending 11 November 2016.

 

Mrs Culligan advised that, since the meeting of the Committee held on 20 September, one new complaint had been received. She added that she was currently seeking further information from the complainant, in order to clarify the allegations made.

 

Mrs Culligan added that there had been one outstanding complaint reported upon at the last meeting. She said that, following consultation with the Council’s ‘Independent Person’, it has been concluded at the initial assessment stage that the allegations did not amount to a breach of the Members’ Code of Conduct.

 

RESOLVED – That the update on complaints received under the Members’ Code of Conduct be noted.

AG42/16

Strategic Risk Report pdf icon PDF 91 KB

Additional documents:

Minutes:

Lee Colyer, the Director of Finance and Corporate Services, presented a risk management report, which described the authority’s arrangements for managing strategic risk. The report provided an update on the evaluated threat level as well as the controls in place for each of the 10 risks identified.

 

Mr Colyer added that the Head of Economic Development, David Candlin, had been invited to the meeting, to report on the risks where he was the named ‘officer risk owner’, namely risks 2 and 10.

 

Risk scenario 2 – Being unable to maximise economic opportunities and resolve infrastructure issues

 

Mr Candlin began by drawing attention to the changes made to the ‘current controls/mitigations in place’ since the last report, made in September. He summarised what initiatives the Borough Council had been actively pursuing, in order to seek funding for infrastructure schemes or how working in partnership with KCC projects had been progressed.

 

Mr Hedges sought clarification on a specific scheme, namely the proposal to install a cycleway along the A26 between Tunbridge Wells and Tonbridge. He asked what the Borough Council’s response was to the fact that part of the dedicated bus route would be lost as a result. Mr Candlin said that this scheme, which was currently the subject of formal public consultation, was the result of close partnership working with KCC and featured in the Council’s Cycling Strategy. He advised that there were a couple of short sections where the narrow width of the highway prevented a cycle lane from being installed along the entire length. He added that there was also a short length where the bus lane was being proposed to be removed by Southborough Common. However, due to the overall benefits that the scheme would bring for cyclists, the Borough Council was fully supportive of the proposal.

 

Town Councillor Henshaw asked if the Borough Council was in favour of having a cycle lane in both directions.  Mr Candlin said that this would be the ideal situation but the width of the highway did not provide sufficient room for this to be achieved in both directions along the length of the route.

 

Mr Quigley said that he was satisfied with the controls and mitigations in place under risk scenario 2. On the A21 dualling scheme, he asked if there were any material effect on the recently-reported slippage to this particular project. Mr Candlin advised that there was the potential for the delay to have a material adverse effect on both the North Farm businesses and on the broader community.

 

Mr Quigley enquired further: he asked if this required a change to the risk profile for the project, either in terms of ‘likelihood’ or ‘impact’. Mr Candlin considered that it did not require a change in the risk status.

 

Councillor Hamilton asked if any reassurance could be given in respect of the Borough Council’s chances of making successful bids for ‘growth fund’ money. Mr Candlin advised that the Council was working closely with KCC and a number of scheme bids  ...  view the full minutes text for item AG42/16

AG43/16

Annual Audit Letter 2015/16 pdf icon PDF 103 KB

Additional documents:

Minutes:

Lee Colyer, the Director of Finance and Corporate Services, presented the Annual Audit Letter for 2015/16, as compiled by the authority’s external auditors, Grant Thornton. He advised that the Audit Letter confirmed an unqualified audit opinion across all financial governance and forward planning aspects and emphasised that this was the sixth year in succession that the authority had achieved this position.

 

Mr Hedges drew attention to the audit fee of £51,230 and asked for a breakdown of the number of audit days. Mr Colyer advised that the figure was in line with the scale fee set by the PSAA (Public Sector Audit Appointments Limited). (Mr Oyerinde refers to this same point below.)

 

Mr Quigley asked what lessons had been learnt from meeting the earlier deadline achieved this year, an aspect which the authority volunteered to undertake, ahead of it being a requirement in the future. Mr Colyer advised that he felt it demonstrated the close, professional working relationship that had developed between the authority and Grant Thornton. He added that this had meant that the Council knew the exact quality and timescale of evidence which was needed and was able to comply with those requirements.

 

The Chairman congratulated both the external auditor and the authority’s staff for this welcome achievement. He invited Ade Oyerinde, Grant Thornton’s Manager for the authority, to comment on the key aspects of the Audit Letter.

 

Mr Oyerinde described the Audit Letter as ‘good news’ for the authority, although he said that most of the content was information and detail which was well-known to members of the Committee. Mr Oyerinde added to the ‘audit fee’ comment above. He said that the fee was set by the PSAA and that it was essentially based upon the size of the local authority in terms of its level of expenditure. He added that, when the Borough Council, along with all other local authorities, sought to appoint an external auditor under the new arrangements to be introduced in 2018, the number of audit days would be set out.

 

Mr Oyerinde updated some of the ‘work in progress’ detail in the Letter and confirmed that, with the completion of this work he could now confirm that there were no additional audit costs involved beyond the estimates set out.

 

Mr Oyerinde advised that the most important lesson which had been learnt from meeting the earlier deadline was the early testing of the data and evidence as part of the interim audit. He added that Grant Thornton were particularly pleased with the commitment shown by the Finance staff in responding promptly to requests for further information, a position which he hoped would become firmly embedded in the future.

 

Mr Shiels sought further information about the ‘Tax advisory service to the Tunbridge Wells Property Holdings Company’. Mr Colyer advised that the audit fee related to the Council’s wholly-owned property company and its position regarding liability to pay corporation tax. My Oyerinde confirmed that, to date, there had been no such liability.

 

RESOLVED –  ...  view the full minutes text for item AG43/16

AG43/16a

External Audit Progress Report pdf icon PDF 93 KB

Additional documents:

Minutes:

Ade Oyerinde, the authority’s external audit manager employed by Grant Thornton, summarised their report, which provided an update on the progress made in delivering the auditor’s responsibilities to the Borough Council.

 

Mr Oyerinde drew attention to the key areas of work which Grant Thornton were undertaking, with a progress comment against each issue. The remainder of the report related to: ‘sector issues’ (e.g. the implications of the Brexit vote); a technical update; and relevant publications and events. Mr Oyerinde also referred to Appendix 1 of the report, which related to the fees being charged for certification work on the authority’s housing benefits subsidy claim. He advised that this work had now been completed, adding that there were no changes to report to members.

 

RESOLVED – That the external audit progress report be noted.

AG44/16

Interim Internal Audit and Assurance Report pdf icon PDF 86 KB

Additional documents:

Minutes:

Russell Heppleston, the Deputy Audit Manager, presented an interim, mid-year report on the work undertaken by the Mid-Kent Audit Service, based upon the audit plan agreed by the Committee in March this year. The update report also covered a number of broader assurance updates, for example counter fraud, governance and risk management.

 

Mr Heppleston drew attention to the key elements of the update report. He advised that: (i) based on current performance forecasts for the end of the year, he anticipated that more days would be given to project work, due to the resilience provided by the Mid-Kent Partnership model of operation; (ii) all of the audit reviews completed so far had resulted in either a ‘sound’ or ‘strong’ assurance rating, with the exception of ‘Safeguarding’, which had been assessed as ‘weak’; and (iii) with the follow-up progress section, there was just the one ‘high priority’ recommendation.

 

Councillor Podbury referred to the safeguarding review, specifically the high priority recommendation that a Disclosure and Barring Service (DBS) policy be introduced. She asked if there was a DBS checking procedure in other operational areas, other than taxis and hackney carriages licensing. Mrs Frankie Smith, Audit Manager, said that the DBS checks for licensing issues were undertaken through the Licensing hub based at Sevenoaks District Council, thus this did not feature as part of the audit review. However, Mrs Smith emphasised that the key issue was that there was no policy in place which was needed to underpin the DBS checking process.

 

The Chairman, Councillor Horwood, asked how the follow-up work on safeguarding was progressing and when a further report might be made to this Committee. Mr Heppleston advised that more detail was being sought as the matter was progressed, and added that the relevant officers had responded positively, within the agreed timescale. Mr Heppleston advised that progress would be included as part of the annual report next year, unless this was requested sooner.

 

Parish Councillor David Coleman felt there was an element of ‘process’ being compared with the ‘actuality’ of the operational area. He asked whether this was particularly the case with the review undertaken on members’ allowances. Mr Heppleston advised that the focus of the audit review had been on ensuring that there was compliance in the operation and payment of members’ allowances against agreed policies; he added that the audit approach was risk-based which took account of the broader potential of risks as well as actual.

 

RESOLVED – That the report on progress against the Audit and Assurance Report 2016/17 be noted.

AG45/16

Future Work Programme pdf icon PDF 23 KB

Minutes:

The Committee’s work programme was presented for members’ information.   

 

Councillor Chapelard enquired whether it was possible for the Committee to vary its work programme, in order to include an audit of the work undertaken on the civic development, before binding decisions were taken.

 

Mr Colyer advised that it was generally the case that audit work was normally undertaken on processes and actions already carried out. He added that it was important to note that the authority’s Development Programme had already been the subject of an audit review, with a ‘sound’ assurance rating given in May this year, which should provide all members with a good degree of reassurance.

 

Mr Colyer advised that both he and the Head of Economic Development, David Candlin, were happy to answer questions and clarify any aspect of the civic development project at any stage.

 

RESOLVED – That the work programme be noted.

AG46/16

Urgent Business

The Democratic Services Officer will advise if there have been any urgent items of business which have arisen for the Board’s consideration since publication of the agenda.

Minutes:

The Democratic Services Officer advised that there were no additional items for the Committee’s consideration which had arisen since the publication of the agenda.

AG47/16

Date of Next Meeting

Minutes:

It was noted that the next meeting of the Committee would take place on Tuesday 4 April 2017 at 6pm.