Agenda and minutes

It was noted that an apology was received from Councillor Kirk Harrison.

The Chair invited those who wished to do so to declare interests in respect of items on the agenda.

There were no declarations received.

RESOLVED:

(i)            The minutes of the Audit and Governance Committee held on 1 August, be confirmed as a correct record and signed.

The Committee received a report by the Assistant Director of Finance and Accountancy to present the draft ISA 260 Report in relation to the Statement of Accounts for East Northamptonshire Council for 2020/21.

Neil Harris (Ernst & Young – External Audit) explained in detail the key areas and points within the draft ISA 260 Report.

Arising from consideration of the report and discussion, Neil Harris (Ernst & Young – External Audit) responded to questions of clarification and the following principal comments were made:

(i)              A Member queried if the matter of the fictious payment had been resolved. In response, the Assistant Director of Finance and Accountancy gave an update and explained the procedures and controls now in place in relation to setting up direct debits;

(ii)            Another Member referred to Neil Harris leaving and wanted to ensure that any additional expenses incurred, if Neil Harris was unable to sign off the audit before he left resulting in additional work in transitioning to a new audit partner, would be a cost to Ernst & Young (External Audit) and not North Northamptonshire Council. Neil Harris considered that such costs would be attributable to Ernst & Young (External Audit);

(iii)           A Member queried the net pension liability and Neil Harris (Ernst & Young – External Audit) and the Assistance Director of Finance and Accountancy explained that this was based on the actuary’s opinion and in accordance with accounting standards;

(iv)          Another Member asked a question in relation to the valuation of pension scheme assets and did that impact the amount members pay into the pension. Neil Harris (Ernst & Young – External Audit) explained that there is a triennial valuation undertaken by the scheme actuary which is on a different basis to the valuation for accounting year end purposes. It is the triennial valuation that sets employer and employee contributions and agrees any necessary deficit repair contributions from employers;

(v)           The Committee were informed that the Council’s finance team were working hard with Neil Harris (Ernst & Young - External Audit) providing audit samples working towards a tight deadline to finalise the accounts before Neil Harris left on 9 September.

RESOLVED:

(i)            The Audit and Governance Committee received the Provisional Audit Results Report and delegated any adjustments to the draft Management Representation Letter to the Council’s Executive Director of Finance (s151 Officer), in consultation with the Chair of the Audit and Governance Committee.

The Committee received a report by the Assistant Director of Finance and Accountancy to receive and approve the draft Statement of Accounts 2020/21 for East Northamptonshire District Council.

The Assistant Director of Finance and Accountancy presented the report and explained in detail the key areas and points within the accounts.

Arising from consideration of the report and discussion, the Assistant Director of Finance and Accountancy responded to questions of clarification and the following principal comments were made:

(i)              A Member queried why the external audit related costs (note 28 in the draft Statement of Accounts) for additional external audit fees for 2019/20 did not show up in last year’s accounts. In response, the Assistant Director of Finance and Accountancy stated that the Council are advised by Ernst & Young (External Audit) of the costs to put in and would be an estimate of the costs occurred during this year.

RESOLVED:

(i)            The Audit and Governance Committee:

(a)  Approved the draft Statement of Accounts for the financial year 2020/21 for East Northamptonshire District Council subject to the conclusion of the audit and that there are no material adjustments that impact on the Council’s usable reserved; and

(b) Any non-material adjustments to the draft Statement of Accounts in relation to East Northamptonshire District Council be delegated to the Council’s Executive Director of Finance (s151 Officer), in consultation with the Chair of the Audit and Governance Committee.

The Committee received a report from the Executive Director of Children’s Services in relation to Children’s Services and the arrangements with Northamptonshire Children’s Trust (NCT). In addition to the report the Committee also received an additional report from the Northamptonshire Children’s Trust (NCT) from the Chief Executive, the Director of Finance and the Director of Children’s Social Care in relation to Northamptonshire Children’s Trust.

At the meeting of the Audit and Governance Committee on 20 June 2022, the Committee requested officers contact Northamptonshire Children’s Trust with regard to contractual arrangements and access to documents and records and considered it would be appropriate for the Executive Director of Children’s Services and a representative to address the Audit and Governance Committee. The Chair of the Audit and Governance Committee wrote to the Executive Director of Children’s Services and the Chief Executive of Northamptonshire Children’s Trust (NCT) to invite them to address the Committee, with a particular focus on the sources of assurance for both Northamptonshire Children’s Trust (NCT) and North Northamptonshire Council.

The Executive Director of Children’s Services presented a report and the Committee received a presentation from the Assistant Director Commissioning and Partnerships in relation to an overview of the work of Children’s Services and the arrangements with Northamptonshire Children’s Trust (NCT). The presentation included how the key risks (financial and non-financial) were managed, deriving assurance on performance and controls (internal and external) and arrangements for risk, control and Governance arrangements.

Arising from consideration of the report and discussion, the Executive Director of Children’s Services responded to questions from the Committee and the following principal comments were made:

(i)             The Committee asked for an explanation and overview of the set-up of the budget funding and where this comes from and referred to the overspend and questioned if the budget factored in increases in fuel costs and wages. The Executive Director of Children’s Services responded that negotiations for funding were just about to be entered into, and would run through to October, and the final contact value would be negotiated with Finance and Northamptonshire Children’s Trust (NCT). She added that the overspend was mainly attributable to increased staffing and placement costs and social care staff;

(ii)           A member asked how the arrangements that were originally set up were operating with Northamptonshire Children’s Trust (NCT). The Executive Director of Children’s Services reported that the Ofsted Monitoring Visits of which there have been 4 since the last Ofsted Inspection of Local Authority Children’s Services (ILACS) Report, but which are not graded, were largely positive. She advised that Northamptonshire Children’s Trust’s (NCT) first ILACS Report is due imminently in Autumn 2022 and that this would be the first since the inadequate Ofsted ILACS Report of the former Northamptonshire County Council in June 2019;

(iii)           Another Member asked if information relating to performance indicators are available to Corporate Parents. In response, the Executive Director of Children’s Services advised that the Corporate Parent Panel receive this information;

(iv)          With regard to the £4 Million overspend  ...  view the full minutes text for item 78.

The Committee considered a report by the Chief Internal Auditor of an Internal Audit Progress Report on the work of the Internal Audit team and the key findings from audits completed to date. Good progress was being made on the planned audit work and several grant certifications had also been completed during the period. Five audit reports had been finalised since the last meeting.

The Chief Internal Auditor presented the report and explained in detail key areas and points, including the addition to the Internal Audit Plan of follow up audits on Temporary Accommodation and Asset Management; and seeking approval to the postponement of audits on Development Management and Transformation until 2023/24.

Arising from consideration of the report and discussion, the Chief Internal Auditor responded to questions from the Committee and the following principal comments were made:

(i)             A Member asked when timings were expected for the Transformation audit and if the Staff Recruitment audit could be brought forward. The Chief Internal Auditor responded that the Transformation audit would be put into the timetable for the early Quarter 1 or 2 for 2023/24 and this would be confirmed once a risk assessment had been done. In relation to the Recruitment Audit, she responded that this was planned for Quarter 3 and noted the Member’s concerns;

(ii)           Another Member commented that she had concerns in relation to the delivery of SEND (Special Educational Needs and Disability) and requested if internal audit could look into this provision. The Chief Internal Auditor responded that SEND was not in the internal audit plan for this year. It was agreed that the Chief Internal Auditor would discuss this matter further with the Executive Director of Children’s Services.

RESOLVED:

(i)            The Audit and Governance Committee:

(a)   Noted the progress report;

(b)  Approved the addition to the Internal Audit Plan of follow up audits on Temporary Accommodation and Asset Management;

(c)  Approved the postponement of audits on Development Management and Transformation until 2023/24. 

(During the above debate, Councillor Anne Lee left the meeting at 4:10 pm to attend another meeting and therefore did not take part in the voting).

None notified.

The Committee thanked Neil Young (Ernst & Young – External Audit) for his work in relation to the predecessor accounts for the demised Councils and wished him well for the future.