Agenda and draft minutes

Audit & Governance Committee
Tuesday 16th November 2021 10.00 am

Venue: Council Chamber, Arun Civic Centre, Maltravers Road, Littlehampton, BN17 5LF. View directions

Contact: Helen Burt 

Media

Items
No. Item

427.

Apologies for Absence

Minutes:

Apologies for absence had been received from CouncillorsBennett, Goodheart and Northeast

428.

Declarations of Interest

            Members and Officers are reminded to make any declarations of pecuniary, personal and/or prejudicial interests that they may have in relation to items on this agenda and are reminded that they should re-declare their interest before consideration of the item or as soon as the interest becomes apparent.

 

            Members and officer should make their declaration by stating :

a) the application they have the interest in

b) whether it is a pecuniary, personal and/or prejudicial

c) the nature of the interest

d) if it is a prejudicial or pecuniary interest, whether they will be exercising their right to speak to the application

 

Minutes:

            There were no Declarations of Interest made.

 

429.

Minutes pdf icon PDF 206 KB

The Committee will be asked to approve as a correct record the Minutes of the Audit & Governance Committee held on 07 October 2021.

Minutes:

            The Minutes of the meeting held on 7 October 2021 were approved by the Committee. These would be signed at the end of the meeting.

 

430.

Public Question Time

To receive questions from the public (for a period of up to 15 minutes)

Minutes:

The Chair confirmed that no questions were submitted for this meeting.

 

431.

Audit Fees 2019/20 Update pdf icon PDF 228 KB

Each year the Council is advised of the anticipated external audit fees set by the designated appointing body.

 

At its meetings of February and July 2021 the Committee was advised of a significant fee increase notified to the Council by its external auditors.  The increase would need to be agreed by the commissioning body – Public Sector Audit Appointments Ltd (PSAA) and members requested that letters be sent to PSAA to express the concerns of the Committee.

[15 Minutes]

Additional documents:

Minutes:

Upon invitation of the Chair, the Internal Audit Manager introduced his report. He explained that since publishing the Agenda, the Committee has received a response from Public Sector Audit Appointments Ltd (PSAA), to say that following the review of the fee variation proposal, the variation they supported was roughly £14500, which was less than half of the fee variation. Through PSAA the Council had been allocated £22666 of Government funding to support affected local bodies to meet the anticipated rise in fees for 2020/21 audits. The PSAA reply (and also an additional letter from Ernst & Young) covering the delay to the commencement of the audit, provided some wording to be published by the Council to explain that the Accounts had not yet been audited and the reasons for this. This has been published with the unaudited draft Accounts on the Council’s website and the external audit was currently underway.

 

            There were no questions from Members.

 

            The Committee agreed that they had noted the correspondence From PSAA updating the Council on the outcome of its review of the fee variation proposal.

 

432.

Arrangements for Appointment of External Auditor pdf icon PDF 171 KB

This report presents the options for the future arrangements for the appointment of external auditors with effect from the 2023/24 financial year, in accordance with the relevant legislation, for a decision to be taken by Full Council.  The current contract procured through Public Sector Audit Appointments Ltd (PSAA Ltd), undertaken by Ernst & Young LLP is due to end and the Council must consider its options and make a decision on its future arrangements.

[10 Minutes]

Minutes:

Upon invitation of the Chair, the Interim Group Head for Corporate Support introduced her report, which explained the advantages and risks that could be adopted for future arrangements for the appointment of external auditors. It mentioned limited availability of suitable auditors and the requirement to set up an independent Audit Panel, which was the main disadvantage of both the stand-alone and joint procurement options.

 

            There were no questions from Members.

 

            The recommendations were Proposed by Councillor Chapman and Seconded by Councillor Oliver-Redgate.

 

The Committee

 

            RECOMMEND TO FULL COUNCIL that

 

1)    Opting-in to the Sector Led Body for the procurement and appointment of external auditors with effect from 2023/24 be approved; and

2) The responsible Officers be authorised to opt-in to the Sector Led Body for the procurement and appointment of external auditors with effect from 2023/24.

 

433.

Treasury Management Mid-Year Report 2021/22 pdf icon PDF 603 KB

This mid-year report has been prepared in compliance with the Chartered Institute of Public Finance and Accountancy’s (CIPFA) Code of Practice on Treasury Management and covers the activities to 30th September 2021. It enables the Audit and Governance Committee to scrutinise the report prior to making comment to Full Council.

[10 Minutes]

Minutes:

            Upon invitation of the Chair, the Senior Accountant (Treasury) introduced her report. She drew Members’ attention to the interest rate forecast at 3.2 on Page 27, informing Members they had now been advised by Link Group that there would be an increase in December 2021 of up to 0.25% and in June 2022 of up to 0.50%, which was different to the figures shown in the table. Also on Page 30, Leads & Principality had now been added to the investment list which adhered to Category 4 on page 41 of the approved strategy.

 

            There were no questions from Members.

 

            The recommendations were Proposed by Councillor Chapman and Seconded by Councillor Chace.

 

The Committee

 

                        RECOMMEND TO FULL COUNCIL that

 

(i) the actual prudential and treasury indicators for 2021/22 contained in the report be approved;

 

(ii) the treasury management mid-year review (this report) for 2021/22 be noted;

 

(iii) the treasury mid-year activity for the period ended 30th September 2021, which has generated interest receipts of £225,000 (0.62%) year to date, against a budget of £332,000 (0.64%) for the full year be noted.

 

(iv) the addition of Leeds and Principality Building Society to the lending list adhering to the required criteria of category 4 be noted.

 

434.

Arun District Council Partnerships Register pdf icon PDF 289 KB

This paper sets out progress on a register of partnerships for Arun District Council and makes recommendations on how this should go forward.

[15 Minutes]

Additional documents:

Minutes:

            Upon invitation of the Chair, the Internal Audit Manager introduced the report. He explained that he was presenting the report on behalf of the Group Head of Policy, who was unable to attend the Meeting. He highlighted paragraph 3.2, an agreed definition of what constituted a partnership arrangement for this purpose, and paragraph 2.7 which excluded purely contractual relationships with key partners (e.g. Biffa, Freedom Leisure, etc.), which should have formal governance and reporting in place.  The Register would need to be maintained by Officers and reviewed periodically by Members and, should it be required, further review of some partnerships may be requested, to consider the role of the Council and to confirm that appropriate benefits were being achieved. 

 

A discussion then took place, and the following points were raised:

·         The report was welcomed, along with the opportunity for Internal Audit to carry out detailed reviews, as prior to this there had been no mechanism to carry out Partnership reviews.

·         Clarification was sought on how often the register would be reported back to the Audit & Governance Committee, and also how the work would be resourced and funded. It was agreed the Committee Manager would request an update from the Group Head of Policy, to be circulated to Members.

 

            The recommendation was Proposed by Councillor Chapman and Seconded by Councillor Staniforth.

 

 

The Committee

 

            RESOLVED

 

That the Audit and Governance Committee review the Partnerships Register on an annual basis and direct Internal Audit to carry out detailed reviews where necessary

 

435.

Updated Risk Management Policy Statement and Strategy pdf icon PDF 128 KB

The Council’s Risk Management Policy Statement & Strategy has been reviewed and some minor changes made to reflect the change to the Committee system of governance at the Council

[10 Minutes]

Additional documents:

Minutes:

            Upon invitation of the Chair, the Internal Audit Manager introduced the report.

 

            It was observed by Members that the Terms of Reference of Committees would be subject to change as Arun District Council moved forward corporately. This would potentially be subject to close scrutiny, possibly by a joint Officer/Member team, to ensure Risk matters were not missed.

 

            The recommendation was Proposed by Councillor Oliver-Redgate and Seconded by Councillor Haywood.

 

 

The Committee

 

            RESOLVED

 

That the updated Risk Management Policy Statement & Strategy, which was to be amended by the Internal Audit Manager to reflect the recent name changes of some Committees, was considered and noted

 

436.

Updated Strategic Risk Register 2021/22 pdf icon PDF 130 KB

The Council’s Strategic Risk Register has been reviewed and revised to reflect changes  since its last update in July 2020.

[20 Minutes]

Additional documents:

Minutes:

            Upon invitation of the Chair, the Internal Audit Manager introduced the report. He explained the Council’s updated Strategic Risk Register was presented on behalf of the Governance & Risk Group following its annual review.  The document had last been noted by the Committee in July 2020 following an urgent interim review to include the significant Covid-19 risk that had materialised. The Governance & Risk Group’s review had agreed some wording changes and updates to various risks.  No risks had been added or removed and the only risks that required altered scoring by the Group were Elections (17) and the Coronavirus Pandemic (20). The Elections risk had been increased in 2020 as there was a backlog of events and there were concerns as to how an election could be held with requirements to meet Covid-19 social distancing, etc.  As the situation became less restrictive and the May 2021 elections were successfully conducted it was felt appropriate that this risk was reduced slightly. The Coronavirus Pandemic risk had been included urgently in 2020 at the highest red level as the situation developed from March onwards with significant restrictions in place and massive uncertainty for the future.  The situation had since improved with most restrictions currently removed and far more was now known. In light of this it had been felt appropriate to reduce the risk score slightly.  However, this still remained a significant risk (rated red) as the situation remained under review nationally

 

            The Internal Audit Manager was thanked for presenting the report on behalf of the Risk Management Group. It was stated that this was an important document, and it was worth Members continuing to be aware of the areas of risk

 

            The recommendation was Proposed by Councillor Chace and Seconded by Councillor Oliver-Redgate.

 

 

The Committee

 

            RESOLVED

 

That the revised Strategic Risk Register was considered and noted

 

437.

Progress Against the Audit Plan pdf icon PDF 33 KB

Each year Internal Audit undertakes its work against an annual audit plan, as approved by the Audit & Governance Committee prior to the start of the financial year

 

The Committee is required to oversee the provision of an adequate and effective internal audit service.

[5 Minutes]

Additional documents:

Minutes:

            Upon invitation of the Chair, the Internal Audit Manager introduced the report.

 

The report was noted by the Committee.

 

438.

Work Programme pdf icon PDF 446 KB

The Committee is required to note the Work Programme for 2021/22.

[5 Minutes]

 

Minutes:

            The Committee then noted the Work Programme.