Agenda and minutes

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

Announcements

The Chair welcomed Councillor Elliot Prentice to the Committee as a Full Member.

Following ratification by Full Council on Thursday 24 November 2022, the Chair welcomed the newly appointed Independent Person, Mr Michael Whitworth, as a Full Member of the Committee. Mr Whitworth introduced himself and explained his background and experience from working in corporate and private banking, together with knowledge of school safeguarding as some of the skills he could bring to the Committee.

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

There were no declarations received.

The Chair referred to Minute 78 (Report of Children’s Services (including Northamptonshire Children’s Trust). He explained that at Full Council on Thursday 24 November 2022, the recommendation for the Northamptonshire Children's Trust Annual Report (Item 10) was amended. This was following the direct output from the considerations of the Committee at the Audit and Governance Committee held on 5 September 2022.

The recommendation at Full Council was amended to note the gaps in sources of assurance as debated at the Audit and Governance Committee on 5 September 2022, and that the Committee is seeking actions from the Northamptonshire Children’s Trust, to review their control processes.

Since the last meeting of the Audit and Governance Committee, the Chief Internal Auditor reported that she had a meeting with the Lead Finance Officer at the Children’s Trust, and as a result of this, does have a copy of their Internal Audit Plan and Risk Register Entries. She has also requested a quarterly meeting with the Lead Officer and Chief Internal Auditor for West Northamptonshire Council. This will enable our Chief Internal Auditor to feedback to this Committee in relation to assurance progress.

RESOLVED:

(i)            The minutes of the Audit and Governance Committee held on 5 September, be confirmed as a correct record and signed.

The Committee received a report from the Chief Internal Auditor for 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 progressing planned audit work and a number of grant certifications had been completed during the period. Seven audit reports had been finalised since the last meeting.

The Chief Internal Auditor presented the report and explained in detail the key areas and points and also to get approval to amend the Audit Plan for 2022/23, to remove the planned audit on Preparation for the Care Act Reforms and reallocate those audit days to an audit on secure use of Council bank accounts in adult social care settings.

The Director of Place and Economy and the Assistant Director of Highways and Waste were present at the meeting to brief the Committee, in relation to the audit for the Home to School Transport (2021/22 audit led by West Northamptonshire Council); The Assistant Director of Growth and Regeneration was present in relation to the audit for S106 Agreements 2021/22; and The Executive Director of Customer & Governance (Monitoring Officer)was  present and would respond in relation to the audit for Enforcement Files 2021/22.

Arising from consideration of the report and discussion, the following principal comments were made:-

(i)            A member had concerns in relation to Debt recovery and members of the public being billed years later. The Assistant Director of Finance responded, that she would have to look at individual cases but a debt could come back for recovery even if extinguished several years before;

(ii)          Another member referred to a contract not being awarded in accordance with contract procedure rules. The Chief Internal Auditor responded that this was a contract in the Children’s Education Service and the Director had been informed;

(iii)         The Chair asked for an update in relation to the delivery of the Audit Plan and recruitment of staff for the Audit Team. The Chief Internal Auditor advised that she was going again in the hope of recruiting further resources for 2023/24. All audits for the 2022/23 year had been allocated to existing resources;

(iv)               The Assistant Director of Highways and Waste reported to the Committee that the Home to School Transport had previously been hosted by West Northamptonshire Council after it had previously been provided by the former Northamptonshire County Council. The audit of this service was completed by West Northamptonshire Council and was concluded on 26 August 2022 and the outcome received by this Council on 4 October 2022, which meant the November Audit and Governance Committee was the next available meeting to report the findings. The service has now been disaggregated from West Northamptonshire Council;

(v)                Concerns were raised by members in relation to timings as to when the outcome of the audit had been received by this Council, given the significant weaknesses and why there had been such a delay, in this information being received, as the audit had  ...  view the full minutes text for item 85.

The Committee received a report from the Chief Internal Auditor with a quarterly update on the Council’s Strategic Risk Register entries.

The Chief Internal Auditor presented the report and explained in detail the key areas and points and the update of entries contained in the report.

To assist the Committee, a summary had also been provided in the form of a heat map, showing the current scores in relation to the risk framework.

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

(i)            It was commented that the heat map was useful and should be maintained in the future for reporting to Committee, alongside the Strategic Risk Register entries and that future heat maps should show movements since the last report;

(ii)          Several members commented on the risk of the Children’s Trust listed in the Strategic Risk Register, in relation to increasing the risk until the Committee receives assurance. In addition, another member queried if the Council manages to get assurance in other ways too, via Scrutiny Committees. A comment was also made about the risk factor to the Council’s budgets. In response to the comments made above in relation to the Children’s Trust, the Chief Internal Auditor stated that she would report this back to the Risk Lead Officer.

RESOLVED:

The Audit and Governance Committee:

(a)  Noted the risk management update.

The Committee received a report from the Chief Internal Auditor with an overview of the proposed Audit Planning process for 2023/24 and to consult members on risk areas for consideration in the development of the Audit Plan.

The Chief Internal Auditor presented the report and explained the coverage of this work which needed to inform the end of year Annual Internal Audit opinion. She wanted to consult with the Committee on any risk areas for consideration in the development of the plan.

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

(i)            The Chair suggested further consultation with the Committee and suggested members be involved with a half day training session, for the purpose of developing the Audit plan for 2023/24 and also to include training for Audit Planning. Members welcomed this suggestion. This would take place in March 2023 and the outcomes reported to the Audit and Governance Committee on 24 April 2023;

(ii)          Two members were keen to see the Audit of Management of Capital Projects which was currently listed for Quarter 3 in the Annual Internal Audit Plan;

(iii)         The Chief Internal Auditor was thanked for her work;

(iv)         A member queried if the Audit for Northamptonshire Children’s Trust was separate to this Audit Planning. The Chief Internal Auditor responded that we look at how it is managed and the Intelligent Client Function (ICF) forms part of the Council’s assurance but she is hoping to gain more information from Northamptonshire Children’s Trust, to inform her assurance at year end. The Executive Director of Finance and Performance (Section 151 Officer)  added that this Committee needs assurance from Northamptonshire’s Children’s Trust and we would invite them again to address the Committee to determine if satisfactory assurance is able to be given.

RESOLVED:

The Audit and Governance Committee:

(a)  Noted the proposed approach to the development of the Internal Audit Plan for 2023/24;

(b)  Highlighted any risk areas for consideration in the planning process, which the Committee seeks assurance in the year ahead.

The Committee received a report from the Chief Internal Auditor informing the Council on the work of the Committee during the 18 month period to September 2022 in the form of an Annual Report for presentation to Full Council.

The Chief Internal Auditor presented the report and explained the coverage of the Annual Report and to aim to raise the profile of the Committee and the work that has been done both internally and externally.

The Chair then presented the Annual Report and talked about the significant amount of predecessor accounts that have been brought to Committee, the development of the effectiveness of the Committee and the good work of officers since its formation. In relation to the self-assessment of the Committee’s effectiveness, the Chair reported that himself and the Vice-Chair would be meeting to discuss this and would feedback to the Committee at the half day training day discussed for March 2023, together with any further observations.

Arising from consideration of the report and discussion, the following principal comments were made:

(i)            The Executive Director of Customer & Governance (Monitoring Officer) noted that the Annual Report would be presented to Full Council and informed the Committee that it was proposed that in future all Annual Reports would go to Full Council in March. The Chair responded that this first Annual Report was slightly different in that it was for a period of 18 months and that the timing of the report meant that it was more meaningful. The Senior Democratic Services Officer would consult with the Executive Director of Customer & Governance (Monitoring Officer) regarding the timing of the presentation of the Annual Report to Full Council and the most effective time in the year for its completion and presentation;

(ii)          In relation to the self-assessment, a member commented that he would like to have seen further detail on the survey on the survey findings and actions. The Chair welcomed his comments and explained that the survey was not  tailor made for this Committee as was originally intended, but a template that was used, so as not to delay the exercise. In future a tailored self-assessment could be used;

(iii)         Another member referred to the amount of work that had been carried out this year and gave his appreciation to the Chair.

RESOLVED:

The Audit and Governance Committee:

(a)  Approved the Annual Report for presentation to Full Council.

The Committee received a report from the Assistant Director of Finance and Accountancy to receive and approve the draft Statement of Accounts in relation to Corby Borough Council for 2020/21, for publication.

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)        The Chair asked the Assistant Director of Finance and Accountancy to outline the plan to the Committee for the clearance of the audit of the accounts. In response, she advised that the audit was due to take place on 9 January 2023, for 8 weeks with no scope for movement. She added that she has had to ensure that the Team is set up ready to deal with the audit in a timely manner. She advised that she has agreed a plan of working with Ernst & Young (External Audit);

(ii)       The Assistant Director of Finance and Accountancy reported that the audit should be completed late February/early March with the intended final sign off of the accounts in April 2023.

RESOLVED:

The Audit and Governance Committee:

(a)  Noted the draft Statement of Accounts for the financial year 2020/21, for Corby Borough Council.

Paul Harvey (Grant Thornton- External Audit) gave a verbal update to the Committee. He reported that as the draft Statement of Accounts for Corby year end 31 March 2021, had not yet been delivered, Grant Thornton were prioritising on other audits and expect to present their Audit Plan to the Audit and Governance Committee on 20 February 2023.

He reported that they had been working on the IT audit and hoped to reach a conclusion to bring to the Audit and Governance Committee on 20 February 2023. Work had also been carried out on Value for Money (VFM) which was not tied up to the Financial Statement. A draft version of the report would be shared with officers for comment shortly. He advised that he could see no significant weaknesses to date but reported that he anticipated that there would be a number of improvement recommendations which is expected with this being the first year of the Council being in existence.

Paul Harvey reported that he had consulted with their quality team and could bring the report to the February Audit and Governance Committee meeting  on 20 February 2023, even though Ernst & Young (External Audit) had not yet completed their 2020/21 Value for Money (VFM) work for the legacy Northamptonshire Councils.

Paul Harvey added that the position in relation to the treatment of infrastructure assets and the potential statutory override is not yet finalised and is expected to be settled by 25 December 2022.

The Chair asked Paul Harvey for an update on the recent report from the Financial Reporting Council (FRC) in relation to Major Local Audits and Audit Quality Inspection, and other audit quality reports and specifically the results  for Grant Thornton. Paul Harvey reported that there had been 36 inspections and Grant Thornton were subject to 15 of those, which is a reflection of their market share. 12 were deemed passable at the minimum level and 3 had specific issues that did not meet the quality standards. A member commented on the 3 that did not meet the standards required. Paul Harvey advised that these are specific issues and gave the Pension Fund as an example, where they can change their processes and re-issue. He added that he was pleased with the outcome for Grant Thornton.