Agenda and minutes

There were no declarations of interest.

To approve as a correct record the minutes of the meetings held on 23^rd January 2017 and the 21^st February 2017.

RESOLVED:

That the minutes of the last meeting held on the 23^rd January 2017 and 21^st February 2017 be confirmed as a correct record.

There were no public questions.

To receive any petitions and deputations provided that no such petition or deputation is in relation to:

·         Matters relating to individual Council Officers, or

·         Matters relating to current or pending legal proceedings

There were no petitions or deputations.

To consider the Action Plan.

The Committee considered the action plan.

Councillor Stephens questioned whether there had been any progress on the outcome of the claim to the Election Claims Unit in respect of the EU Referendum and requested details of royalty payments the City Council had received.

The Management Accountant confirmed that a breakdown of the royalty payments and an update with regards to the EU referendum Claim would be provided to the Committee.

RESOLVED: That the action plan be noted subject to the suggested amendments.

To consider the report of KPMG on the External Audit Plan 2016/17.

The Committee considered the report of KMPG outlining the External Audit Plan for 2016/17.

Mr Gilbert highlighted key areas of the report noting that two areas that had been identified as requiring significant audit attention were changes in the pension liability due to LGPS Triennial Valuation and the new core financial system. He explained that additional areas of focus also included the Together Gloucester Organisational Change project and fixed asset valuations. He acknowledged that a greater number of value for money audits had been identified for the forthcoming year noting that this was due to the volume of work the City Council were currently undertaking.

Councillor Stephens welcomed the comprehensive and detailed report.  Noting the “clearly trivial” threshold had been set at £80,000 he questioned the reporting mechanism for any inaccuracies or errors that fell below this threshold, commenting that this represented a significant amount of public investment.

Mr Gilbert explained that in instances similar to that described by Councillor Stephens, KPMG would alert the Finance Team and continue to liaise closely with them. The Management Accountant assured the Committee that the Finance Team continued to carry out quarterly budget monitoring which aimed to identify any errors or inaccuracies including those under £80,000. He went on further to explain the Overview and Scrutiny Committee received quarterly budget monitoring reports.

In response to Councillor Pullen’s concerns regarding the new core financial system being unable to work in parallel with the old system and thereby affecting individuals’ benefits claims, the Management Accountant explained that revenues and benefits were operated on a separate system to that of the new financial system. He would therefore not expect any issues with any benefits claims but assured the Committee that checks would be undertaken to ensure the two systems worked in conjunction each other.

In response to the Chair’s query regarding the timeline for the value for money and performance monitoring audits, Mr Gilbert explained that exact timeline had not yet been determined. He explained that it was likely that the results of majority of the audits would be reported to the Audit and Governance Committee in September 2017 and if appropriate, an interim report would be presented to the Committee in June 2017.

RESOLVED: That the report be noted.

To consider the report of the Head of Audit Risk Assurance updating Members of the Internal Audit activity progress in relation to the approved Internal Audit Plan 2016/17.

PLEASE NOTE:  Appendix 2 contains exempt information as defined in paragraph 2 of Part 1 of Schedule 12A to the Local Government Act (as amended).  If Members wish to discuss material contained within this appendix it will be necessary to notify the Chair to enable a resolution to be passed to exclude the press and public.

The Committee considered the report of the Head of Audit Risk Assurance updating Members of the Internal Audit activity progress in relation to the approved Internal Audit Plan 2016/17.

In response to Councillor Stephen’s query regarding appendix 2 of the report being classified as exempt, the Head of Audit Risk Assurance advised Members that the report had been deemed to be exempt as it contained information relating to staff that would make it possible for individuals to be identified.

Councillor Stephens expressed concern that members of the public were being excluded from discussions relating to Marketing Gloucester Limited (MGL) that were of public interest and queried whether a revised version of appendix 2, excluding information relating to staff could be made public.

The Council Solicitor and Deputy Monitoring Officer confirmed that the Committee were able to debate the content of Appendix 2 of the report in public session provided that information relating to staff was not disclosed. She reported that a public version of Appendix 2 would be appended to the minutes of the meeting.

Councillor Stephens expressed disappointment at the lack of progress made with implementing the recommendations as set out in the original MGL audit. Referencing the loan of £97,000, Councillor Stephens queried the purpose and terms of agreement for the loan and questioned whether it was appropriate for the Council to subsidise a private company.

The Head of Audit Risk Assurance advised Members that since the publication of the agenda the Memorandum of Articles of Association, Members Agreement and the Contract for Services had been signed and sealed by both parties. She commented that the secondment agreement for the relevant staff members was currently being drafted and results of the MGL Value for Money (VFM) would aim to be shared with the Committee at the September 2017 meeting.

The Management Accountant confirmed that MGL had access to external funding generated from a number of sources, including entry fees for events like the Tall Ships Festival. He noted that the loan to MGL had been granted to help cover the company’s initial start-up costs.

In response to Councillor Stephens’ query, the Management Accountant and Council Solicitor confirmed that formal clarification on the purpose and terms of agreement for the loan to MGL would be provided to the Committee.

The Chair noting the Head of Audit Risk Assurance’s comments, requested that the MGL VFM Audit be scheduled into the Audit and Governance Work Programme for the September 17 Committee meeting.  The Head of Audit Risk Assurance reported that Internal Audit team aimed to report back to the Committee at September 2017 meeting but acknowledged that appropriate time needed to have passed, post implementation of the recommendations, before the audit could be conducted.

Councillor Wilson expressed disappointment that the Memorandum of Articles of Association and other agreements had only been agreed and signed the previous week. Referencing performance monitoring of the MGL governance arrangements within the report, he queried whether the VFM audit would also review progress in relation to  ...  view the full minutes text for item 71.

To consider the report of the Head of Audit Risk Assurance providing the Committee with a summary of the proposed 2017/2018 Risk Based Internal Audit Plan 2017/2018 as required by the Accounts and Audit Regulations 2015 and the Public Sector Internal Audit Standards (PSIAS) 2016.

The Committee considered the report of the Head of Audit Risk Assurance providing the Committee with a summary of the proposed 2017/2018 Risk Based Internal Audit Plan 2017/2018 as required by the Accounts and Audit Regulations 2015 and the Public Sector Internal Audit Standards (PSIAS) 2016.

The Head of Audit Risk Assurance summarised key areas of the report commenting that the plan included an audit of the Councillors Community Fund following a suggestion from the Cabinet Member for Performance and Resources.

The Chair encouraged Members of the Committee to continue to put forward any areas of work that they considered appropriate for the Internal Audit function to review.

Councillor Stephens welcomed the report and the inclusion of the Complaints Policy as an area of focus. He commented that it would be useful if the Internal Audit team were able to explore the use of multiagency working and the role of Members within the feedback process. He suggested that it would also be helpful if a review of the implementation of the business rates reform were conducted to ensure that this was being applied correctly.

The Management Accountant explained that following the announcement of the business rates reform by the Government in the Spring 2017 budget, Civica had begun promptly to identify and write to all business affected.

In response to Councillor Melvin’s query whether the press had been approached to help advertise the changes to Business Rates, the Management Accountant explained that this had not been explored. He confirmed that the finance team would continue to liaise with Civica on the most appropriate way to alert affected businesses to the changes.

The Cabinet Member for Performance and Resources (Councillor David Norman) congratulated officers on their prompt action following the announcement by the Chancellor of the Exchequer on the 8^th March 2017. He considered that it would be appropriate to continue to allow Civica to contact all affected businesses and if necessary advertise using the media after an allotted period.

The Chair requested that a management update of the progress of implementation of Business Rates reform be timetabled into the Audit and Governance work programme. He congratulated officers from the Civica revenues and benefits for the speed in which the implementation had been progressed.

RESOLVED:

1.    Agree that the Internal Audit Plan for 2017/2018 reflects the risk profile of the Council;

2.    Approve the Internal Audit Plan 2017/2018 as detailed in Appendix 1.

3.    A progress update of the business rates reform be timetabled into the Audit and Governance Work Programme.

To consider the report of the Head of Audit Risk Assurance providing Members with an update on the Council’s risk management activities from 2016/17 and also confirm future planned actions.

The Committee considered the report of the Head of Audit Risk Assurance which provided Members with an update on the Council’s risk management activities from 2016/17 and also confirmed future planned actions.

RESOLVED that:

1.    The following be noted and endorsed:

a)    The risk management arrangements in place for the past year;

b)    The proposals for future development of risk management; and

c)    The strategic risk register (Appendix 1).

2.    Arrangements for managing risk within the Council are sound.

To consider the report of the Cabinet Member for Performance and Resources formally recommending that Council approves the attached Treasury Management Strategy, the prudential indicators and notes the Treasury activities.

The Committee considered the report of the Cabinet Member for Performance and Resources which formally recommended that Council approved the attached Treasury Management Strategy, the prudential indicators and noted the Treasury activities.

RESOLVED to RECOMMEND: That the Treasury Management Strategy be approved.

To consider the Work Programme.

The Committee noted the Audit and Governance Work Programme 2017.

Monday 19^th June 2017 at 6:30pm in the Civic Suite, North Warehouse.

Monday 19^th June 2017 at 6:30pm in the Civic Suite, North Warehouse.

The Chair thanked the Democratic and Electoral Services Officer for consistently producing accurate and detailed minutes that reflected the excellent work undertaken by the Committee.