Corporate Governance, Audit and Standards Committee - Monday, 27th June, 2016 7.00 pm - Agenda and minutes
Venue: Council Offices, Farnborough
Contact: Committee Administrator, Kathy Flatt Tel. (01252 398829) or email kathy.flatt@rushmoor.gov.uk
No. | Item |
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To confirm the Minutes of the Meeting held on 26th May, 2016 (copy attached). Minutes: The Minutes of the Meeting held on 26th May,
2016 were approved and signed by the Chairman.
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External Auditor - Progress Report - June 2016 PDF 145 KB To
receive a progress report (copy attached) from the Council’s external auditor,
Ernst &Young. Mr.
Adrian Balmer (Manager, Ernst & Young) will be in attendance at the meeting. Minutes: The Committee welcomed to the meeting Mr. Adrian Balmer, Manager at Ernst and Young. Mr. Balmer
presented his company’s audit progress report, a copy of which had previously
been circulated to the Committee. The
purpose of the report was to provide an overview of the progress made in
respect of work to be completed during the 2015/16 audit. The report summarised actions in connection
with the fee letter, financial statements, value for money, the appointment of
an external auditor, financial close arrangements and set out a timetable
showing the key stages of the audit. RESOLVED: That the audit progress report be noted. |
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Statement of Accounts 2015/16 - Duties and Responsibilities PDF 177 KB To receive the Head of Financial Services’ Report No. FIN1612 (copy attached), which sets out the Council’s draft Statement of Accounts and the Committee’s duties and responsibilities in respect of the Statement. Additional documents: Minutes: The Committee received the Head of Financial Services’
Report No. FIN1612, which set out the Council’s draft Statement of Accounts and
the Committee’s duties and responsibilities in respect of the Statement. The Statement of Accounts for 2015/16 had been prepared in
line with CIPFA’s Code of Practice on Local Authority Accounting, under
International Financial Reporting Standards and in accordance with the Accounts
and Audit (England) Regulations 2015.
CIPFA recommended practice was to issue the Statements to ‘those charged
with governance’ in advance of the September approval meeting in order to allow
sufficient time for due consideration of the information. The Committee’s role was to provide effective scrutiny of
the Council’s financial statement. This
formed part of a system of financial responsibility, as set out in the draft
Statement of Accounts. In considering
the accounts, the Committee would need to have regard to: materiality;
transparency; valuation; consistency; completeness; legality/litigation;
classification; economic climate/going concern principle; risk of error; fraud;
and, rights and obligations. Once these
factors had been considered, Members would also need to be satisfied that the
accounts represented a true and fair view of the Council’s financial
position. Members would also need to consider what sources of
information that could be used to help them to approve the accounts and from
whom they might seek assurance. A
variety of sources could be used that could supply a clear and consistent
message about the financial performance of the organisation. These sources might include: internal audit;
the work of the Licensing and General Purposes Committee in considering fraud,
risk and internal reporting; statements of senior officers; external audit
opinion; inspections by HMRC (VAT, PAYE); financial and performance reports;
Members’ own knowledge of the affairs of the Council; information regarding
economic climate, interest rates, property prices, inflation; and, expert
knowledge (eg actuarial reports). Members raised questions in respect of the accounts being
available to members of the public, major legislative changes; and, rogue
landlords operating HMOs without the necessary planning permission. RESOLVED: That the Head of Financial Services’ Report No. FIN1612 be noted. |
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Treasury Management Operations 2015/16 PDF 376 KB To consider the Head
of Financial Services’ Report No. FIN1613 (copy attached), which sets out the main Treasury Management
activities during 2015/16 and provides an update on the current economic
conditions affecting Treasury Management decisions. Additional documents: Minutes: The Committee received the Head of Financial Services’
Report No. FIN1613, which set out the main treasury management activities
during 2015/16 and provided an update on the current economic conditions
affecting treasury management decisions.
It was noted that the Council’s treasury team continued to
concentrate on the security of investments, having due regard to the returns
available. Continued low interest rates
throughout the financial year, coupled with a lack of suitable counterparties
with whom to invest, had made this activity challenging. However, overall investment income had outperformed
the original budget by around £94,000 and had contributed £894,000 to the
Council’s General Fund during 2015/16.
Members were advised that all treasury management activity during
2015/16 had been carried out in accordance with the Annual Treasury Management
Strategy and had complied with the treasury and prudential indicators and with
the Treasury Management Code of Practice.
RESOLVED: That the Head of Financial Services’ Report No.
FIN1613 be noted. |
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Internal Audit - Audit Opinion PDF 323 KB To consider the Audit Manager’s Report No. AUD1601(copy attached), which covers an overview of Internal Audit, a proposed reporting approach, the plan of work for 2016/17 and the Audit Opinion for 2015/16. Minutes: The Committee considered the Audit Manager’s Report No.
AUD1601, which provided an overview of internal audit, the proposed reporting
approach, plan of work for 2016/17 and the audit opinion for 2015/16. In respect of producing the plan of internal audit work for
2016/17, it was noted that a range of issues had been taken into consideration,
including: external audit requirements; risk assessments of activities;
corporate initiatives; skills available to undertake
the audit; requests from services; alignment of the plan with corporate
priorities; and, issues and views raised by Committee Members. Members noted that the audit plan for
2016/17 would focus on: meeting the needs of the
external auditors; support of organisational change and development; corporate
governance; and, links to the 8-Point Plan. The Committee was advised that the
Public Sector Internal Audit Standards (PSIAS) 2013 (and amended 2016) required
the Head of Internal Audit to provide an annual opinion of the Council’s system
controls. It was noted
that the overall adequacy and effectiveness of the Council’s framework of
governance, risk management and control was appropriate. This opinion was based
on the evidence provided from audits carried out in 2015/16 on the major
financial systems used by the Council.
All high priority audit recommendations had been agreed by senior
management and were being introduced.
Once implemented, it was felt that these would further improve the
Council’s overall control environment. It was also noted that a statement
on conformance with the Public Sector Internal Audit Standards and the results
of the quality assurance and improvement programme were also required to be
reported. Members were
advised that work was underway to update this and the results would be
reported within 2016/17. RESOLVED: That (i)
the Audit Manager’s
Report No. AUD1601 be noted: and (ii)
the proposed meeting
and reporting cycle for 2016/17, as set out in the Report, be endorsed. |
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Annual Governance Statement 2015/16 PDF 129 KB To consider the Solicitor to the Council’s Report No. LEG1608 (copy attached), which seeks approval for the Annual Corporate Governance Statement 2015/16. Additional documents: Minutes: The Committee considered the Solicitor to the Council’s
Report No. LEG1608, which sought the approval of the
Council’s Annual Governance Statement for 2015/16. Members were advised that the Accounts and
Audit Code of Regulations 2015 and Regulation 6 (1) required local
authorities to prepare an Annual Governance Statement. These had replaced the
Accounts and Audit Regulations 2003 (as amended in 2006 and 2011) which had
previously been in place. CIPFA had
also published a revised version of its framework document on preparing the
Code of Governance entitled Delivering Good Governance in Local Government:
Framework (2016 Edition). During the
course of 2016 the Council’s Code of Governance would
be reviewed against this and a revised version would be brought to the
Committee for approval. The Regulations
required councils to ensure that their financial management was adequate and
effective and that there was a sound system of internal control. The Annual Governance Statement had to include notification
of any significant internal control issues and an action plan to address
them. The Committee was
advised that no significant issues had been identified for 2015/16. A number of actions for the current year had been identified and would be addressed during the
year. The Leader of the Council and the
Chief Executive were required to sign the Annual Governance Statement. The Annual Governance Statement, when
approved, would be published alongside the Statement of Accounts by 30th September, 2016. During discussion, a question was raised
regarding co-location of the Council with other organisations at the Council
Offices and the impact on car parking availability. RESOLVED: That (i)
the Annual Governance
Statement, as set out in the Solicitor to the Council’s Report No. LEG1608, be
approved; and (ii)
the Annual Governance
Statement be published with the Council’s Statement of Accounts. |