Agenda and minutes

Audit and Governance Committee - Tuesday, 17th July, 2018 6.30 pm

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Venue: Committee Room A, Town Hall, Tunbridge Wells, Kent TN1 1RS

Contact: Mike McGeary  Democratic Services Officer

Items
No. Item

AG5/18

Chairman's Announcements

Announcements on procedural matters

Minutes:

The Chairman opened the meeting and outlined various procedural matters.

AG6/18

Apologies for Absence

Apologies for absence as reported at the meeting.

Minutes:

Apologies for absence were reported from Councillor Neve.

AG7/18

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.

AG8/18

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:

The Democratic Services Officer advised that there had been no other members of the Council who had registered their wish to address the Committee, within the provisions of Council Meetings Procedure Rule 18.

AG9/18

Minutes of the Meetings of the Audit and Governance Committee dated 3 April and 23 May 2018 pdf icon PDF 205 KB

The Chairman will move that the minutes of the meetings of the Committee, dated 3 April and 23 May 2018, be signed as correct records. The only issue relating to the minutes which can be discussed is their accuracy.

Additional documents:

Minutes:

The minutes of the meetings of the Audit and Governance Committee dated 3 April and 23 May 2018 were submitted.

 

RESOLVED – That the minutes of the Audit and Governance Committee dated 3 April and 23 May 2018 be approved as a correct record.

AG10/18

Update on Complaints Received Under the Members' Code of Conduct pdf icon PDF 240 KB

This report is to follow

Minutes:

Keith Trowell, the Team Leader (Corporate Governance) and Deputy Monitoring Officer, presented the report.

 

Mr Trowell advised that, since the 3 April meeting of the Committee, four further complaints had been made against the same parish councillor in respect of the same alleged breaches of the Code. He added that these were being treated as one complaint, which was being considered by the Council’s Independent Person.

 

In response to a question as to why the ‘Independent Person’ was not named in the report, Mr Trowell advised that Mr Michael O’Higgins performed this particular duty; he added that Mr O’Higgins’ term of office was due for renewal in October 2019. Mr Trowell said he would include the name of the Independent Person in subsequent reports, if Committee members would find that helpful.

 

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

AG11/18

Draft Annual Financial Report for 2017/18 pdf icon PDF 123 KB

This report is to follow

Additional documents:

Minutes:

Jane Fineman, the Head of Finance and Procurement, presented the draft Financial Report for 2017/18.

 

Mrs Fineman said that the highlights in what had been a very positive year were that: (a) £2.7m had been added to the earmarked reserves (£1m savings from the revenue budget and £1.7m from growth in business rates income); (b) the value of the Council’s property, plant and equipment had risen by £3.3m (mainly due to increases in the value of car parks); and (c) there had been a reduction in pensions’ liability of £3.6m.

 

Mrs Fineman drew attention to the external auditors’ draft ‘Audit Findings Report’, in which they had made a recommendation regarding how future asset valuations are conducted. She added that this recommendation had been agreed in principle, providing that a set of indices can be found which properly reflected those assets. 

 

Darren Wells, a Director of Grant Thornton (the external auditors), said that they expected to issue an unqualified audit opinion, adding that they had not identified any adjustments affecting the authority’s financial position.

 

The following responses were given to points raised by members of the Committee:

 

·       Mrs Fineman said she would examine why one of the Independent Members, Mr Quigley, appeared not to have received the email sent on 11 June which had provided all Committee members with the draft financial accounts;

 

·       A reference in the draft Annual Financial Report suggested that an independent review had been undertaken of the Council’s decision on the new civic development. Lee Colyer, the Director of Finance, Policy and Development, accepted that it might be more appropriate if it read “… procedural approach…” rather than “… decision…”.

 

RESOLVED – That, subject to the above clarification on the civic development issue:

 

(1)   The Committee notes Grant Thornton’s Audit Findings Report (Appendix B);

 

(2)   The Committee approves the draft Statement of Accounts and the Annual Governance Statement (Appendix A); and

 

(3)   The Committee authorises the Chairman and the Director of Finance, Policy and Development to sign a Letter of Representation, based on Appendix A and the Audit Findings Report.

AG12/18

Annual Audit Report and Opinion 2017/18 pdf icon PDF 149 KB

Additional documents:

Minutes:

Rich Clarke, the Head of Audit Partnership, presented the report.

 

Mr Clarke said that this set out his annual opinion on the overall adequacy and effectiveness of the authority’s framework of governance, risk management and control. He advised that, based upon the audit reviews undertaken in 2017/18 – a summary of which was set out in the full Annual Internal Audit Report circulated with the agenda – he was satisfied that: (a) the authority could place assurance on the system of control in operation during 2017/18; (b) the corporate governance framework complied in all significant respects with the best practice guidance issued by CIPFA/SOLACE; and (c) the authority’s risk management processes were effective.

 

On page 19 of the agenda report, Mr Clarke drew attention to paragraph 11 and asked that the word ‘some’ be removed from the sentence. He also asked Committee members to note that the picture on the front page of the Audit Report and Opinion should be credited to Charles Tattershall Dodd.

 

In response to points raised by Committee members, Mr Clarke advised as follows:

 

·       He said that he would happily pass on the Chairman’s congratulations to those members of the Internal Audit team who had successfully completed various professional qualifications during the year;

 

·       In paragraph 28, showing that the number of audit days undertaken in 2017/18 had been 56 fewer than planned, he said that this was partly explained through the use of consultancy resources, covering a period of staff absence through illness;

 

·       He noted the views expressed by the Chairman that the additional updating of risk management was particularly important.  The Chairman had also said that, within the authority’s risk register, he would like to see the impacts more clearly defined for the town, the Borough Council, the general public wellbeing and on individuals. The Chairman added that ‘upside potential’ should also be included in the register, in order to minimise the risk of these not being realised. He felt that the ‘upside potential’ created a balance of risks to ensure overall success.

 

RESOLVED –

 

(1)   That the Committee notes the Head of Audit’s opinion, which states that, in the view of internal audit, the Council’s system of internal control, corporate governance and risk management arrangements have operated effectively during 2017/18; and

 

(2)   That the Committee notes the work underlying the opinion and the Head of Audit’s assurance it was completed with sufficient independence and conformance with Public Sector Internal Audit Standards.

AG13/18

Audit and Governance Committee - Annual Report pdf icon PDF 104 KB

Additional documents:

Minutes:

Frankie Smith, Audit Manager, introduced the Audit and Governance Committee Annual Report for 2017/18.

 

Mrs Smith explained that the Annual Report outlined how the Committee had effectively discharged its duties, providing assurance to the Council that important internal control, governance and risk management issues were being monitored and addressed.

 

The Committee accepted the Annual Report without comment, noting that this would be submitted to the Full Council for information.

 

RESOLVED –

 

(1)   That the Audit and Governance Committee Annual report for 2017/18 be agreed; and

 

(2)   That the Chairman of the Committee present the report to the Full Council, to demonstrate how the Committee discharged its duties.

AG14/18

Strategic Risk Review pdf icon PDF 106 KB

Additional documents:

Minutes:

Lee Colyer, Director of Finance, Policy and Development, introduced the report.

 

Mr Colyer said that the report  set out the authority’s arrangements for managing strategic risk, with an update provided on the evaluated threat level as well as the controls in place for each of the 10 risks identified.

 

William Benson, Chief Executive, drew attention to the fact that one particular risk had now been removed from the risk register – namely ‘not managing control and change effectively – staff, management and political’, as this had now been embedded in every-day activity.

 

Mr Benson highlighted the key aspects of the two areas where he was listed as the risk owner, namely: risk 5 (national policy changes in the short term that impact negatively on the Borough Council); and risk 7 (being unable to meet expectations within resources).

 

In response to points raised, Mr Benson advised as follows:

 

·       (Risk 7) In order to make it easier for the public to know which authority was responsible for what service, the Borough and the County Councils had previously looked at the possibility of common telephone and internet systems. Mr Benson said that the situation had now been improved through both authorities operating Skype for Business communications systems;

 

Mr Benson acknowledged that the point had been made in response to the recent flooding incident; he said that it was the Borough Council’s top priority to determine what factors had led to that situation and to work with the different agencies involved to find a solution;

 

·       (Risk 7) Mr Benson said that, while he was aware of member concerns relating to aspects of the review of the Local Plan, he emphasised that this did not relate to staffing resources, which he stated were close to capacity, with a newly-appointed interim Head of Service in place;

 

·       (Risk 7) Mr Benson said that services and staff being ‘stretched’ was the current reality across the public sector, adding that, if there were a protracted period of increased demand on a section, there were examples of where temporary cover had been provided;

 

·       (Risk 7) Mr Benson was asked what plans were in place to deal with unforeseen disasters. He said that such a situation fell under risk 6, adding that the Committee might find it helpful to raise this with the relevant risk owner – the Head of Facilities and Community Hubs – when she attends the meeting.

 

RESOLVED – That the risk management report and arrangements for managing strategic risk be noted.

AG15/18

Appointment of Members to the Constitution Review Working Party pdf icon PDF 109 KB

Additional documents:

Minutes:

Mike McGeary, Democratic Services Officer, presented this report.

 

Mr McGeary requested the Committee to appoint members to the Constitution Review Working Party, in accordance with the nominations of the political group leaders.

 

Mr McGeary advised that it was a requirement of the Working Party’s terms of reference that its Chairman was an independent member; he added that the current Chairman, Mr Tony Quigley, had indicated that he was agreeable to being re-appointed as the Chairman.

 

RESOLVED –

 

(1)   That Councillors Hill, March and Simmons – who have all been nominated by their respective political group leaders – together with independent member Mr Tony Quigley, be appointed to the Constitution Review Working Party for the 2018/19 municipal year; and

 

(2)   That Mr Quigley be re-appointed as Chairman of the Working Party for the 2018/19 municipal year.

AG16/18

Future Work Programme pdf icon PDF 24 KB

Minutes:

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

 

The Democratic Services Officer was asked to advise Committee members of which risk owners would be attending which meetings, for the year ahead, which he undertook to provide by e-mail.

 

RESOLVED – That the work programme be noted.

AG17/18

Urgent Business

The Democratic Services Officer will advise if there have been any urgent items of business which have arisen for the Committee’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.

AG18/18

Date of Next Meeting

Tuesday 11 September 2018 at 6.30pm

Minutes:

It was noted that the next meeting of the Committee would take place on Tuesday 11 September 2018 at 6.30pm.