Issue - meetings

To consider the Audit Manager’s Report No. AUD 20/07 (copy attached), which presents the Annual Governance Statement 2019/20 for review and approval.

The Committee considered the Audit Manager’s Report No. AUD20/07, which set out the Annual Governance Statement 2019/20 for publication alongside the Council’s Statement of Accounts.

It was noted that the Accounts and Audit Regulations 2015 required councils to prepare and publish an Annual Governance Statement in order to report publicly on the extent to which the Council complied with its Code of Corporate Governance, including how the Council had monitored the effectiveness of arrangements in the year and on any planned changes to the governance arrangements in the coming year.  In particular, the Committee noted that, due to the current Covid-19 pandemic, details of the changes impacting on the governance arrangements within the Council had been included, to provide an update on the current situation and the potential challenges facing the Council during 2020/21.

RESOLVED: That approval be given to:

(i)            the Council’s Annual Governance Statement 2019/20;

(ii)          the Chief Executive and Leader to sign the Annual Governance Statement; and

(iii)         the publication of the Annual Governance Statement alongside the Council’s Statement of Accounts for 2019/20.

To consider the Audit Manager’s Report No. AUD 20/05 (copy attached), which sets out the Internal Audit coverage, findings and performance for 2019/20 and presents the Audit Manager’s overall assurance opinion on the adequacy and effectiveness of the Council’s framework of governance, risk management and control environment.  The Report also covers the self-assessment carried out against the Public Sector Internal Audit Standards (PSIAS) and the progress on the Quality and Assurance Improvement Plan (QAIP) for the year.

The Committee considered the Audit Manager’s Report No. AUD20/05 which set out the Internal Audit coverage, findings and performance for 2019/20 and presented the Audit Manager’s overall assurance opinion on the adequacy and effectiveness of the Council’s framework of governance, risk management and control environment.  The Report also covered the self-assessment carried out against the Public Sector Internal Audit Standards (PSIAS) and the progress on the Quality and Assurance Improvement Plan (QAIP) for the year.

It was noted that, in assessing the level of assurance to be given for 2019/20, the opinion was based on:

·         written reports on all internal audit work completed during 2019/20;

·         results of any follow-up exercises undertaken in respect of previous years’ internal audit work;

·         results of work of other review bodies (where appropriate) eg PSN certification;

·         counter-fraud work carried out by the Corporate Investigations Team;

·         quality and performance of the internal audit service and the extent of compliance with the Standards;

·         NFI data match checks;

·         participation on the corporate governance group;

·         mitigations in place to minimise the risks identified within the Corporate Risk Register

The Report advised that the Audit Manager had given an overall reasonable assurance opinion on the effectiveness of the Council’s framework of governance, risk management and management control for 2019/20.  In respect of the four key areas of non-compliance for the PSIAS, appropriate corrective actions and a timescale for improvement have been agreed with management.  These four key areas were:

·         an external assessment on audit activity;

·         performance targets not in place;

·         updates to policies and procedures;

·         review of the Council’s Ethics related objectives, programmes and activities.

The Report set out a summary of the results of the PSIAS self-assessment.  It was noted that there were eleven overall standards, which were broken down into 336 fundamental principles against which compliance was measured.  The Report advised that, in 2019/20, the Council had been 95% compliant, 4% partially compliant and 1% not compliant.

During discussion, concern was raised about the number of limited assurances in the report.  The Audit Manager acknowledged that the number had increased during 2019/20 but that the overall trend was downwards.  It was her view that a limited assurance was not necessarily negative as it meant that a risk had been identified and controls were being applied to mitigate the risk. 

RESOLVED: That

(i)            the coverage of assurance obtained across the Council to allow the Audit Opinion to be formulated be noted;

(ii)          the level of internal control assessed in 2019/20 through opinion-based audit assurance work be noted;

(iii)         the Audit Opinion given for 2019/20 be noted;

(iv)         the Performance Indicators for the internal audit activity for 2020/21 be endorsed;

(v)          the self-assessment exercise against the Public Sector Internal Audit Standards and the areas of non-conformance with the standards be noted; and

(vi)         the Quality and Assurance Improvement Plan for 2019/20, as set out in Appendix C to the Report, be endorsed.