Agenda and minutes

Audit Committee
Wednesday, 18th July, 2018 6.00 pm

Venue: Committee Room 2, Town Hall. View directions

Contact: Democratic Services  0161 474 3216

Media

Items
No. Item

1.

Minutes pdf icon PDF 65 KB

To approve as a correct record and sign the Minutes of the meeting held on 14 March 2018.

Additional documents:

Minutes:

The Minutes (copies of which had been circulated) of the meeting held on 14 March 2018 were approved as a correct record and signed by the Chair.

2.

Declarations of Interest

Councillors and officers to declare any interests which they have in any of the items on the agenda for the meeting.

Additional documents:

Minutes:

Councillors and officers were invited to declare any interests they had in any of the items on the agenda for the meeting.

 

No declarations of interest were made.

3.

Urgent Decisions

To report any urgent action taken under the Constitution since the last meeting of the Committee.

Additional documents:

Minutes:

No urgent decisions were reported.

4.

Public Question Time

Members of the public are invited to put questions to the Chair on any matters within the powers and duties of the Committee, subject to the exclusions set out in the Code of Practice.  (Questions must be submitted prior to the commencement of the meetingon the card provided.  These are available at the meeting. You can also submit via the Council’s website at www.stockport.gov.uk/publicquestions).

Additional documents:

Minutes:

Members of the public were invited to put questions to the Chair on any matters within the powers and duties of the Area Committee, subject to the exclusions set out in the Code of Practice.

 

No public questions were submitted.

5.

Annual Governance Statement 2017/18 pdf icon PDF 52 KB

To consider a report of the Corporate Governance Group.

 

The attached document (Appendix 1) is the final version of the Council’s Annual Governance Statement (AGS) for 2017/18. The final AGS has been considered by Corporate Leadership Team and the Corporate Governance Group. There has been no material change in governance issues up to the date of this meeting.

 

The Committee is invited to comment on the report.

 

Officer Contact: John Pearsall on Tel: 0161 474 4033 or email: john.pearsall@stockport .gov.uk

Additional documents:

Minutes:

A report of the Corporate Governance Group was submitted (copies of which had been circulated) outlining the issues facing the Authority which needed to be effectively managed and highlighting areas where protocols were being developed to improve compliance with the Local Code of Corporate Governance.

 

A Councillor suggested that further consideration be given to the Code of Conduct and in particular the part relating to personal and prejudicial interests whereby Councillors, when considering grant applications from Community Groups for which they are members, are required to declare and leave a meeting. The Borough Treasurer undertook to raise this matter with the Monitoring Officer.

 

RESOLVED – That the report be noted and the Annual Governance Statement 2017/2018 be approved.

 

6.

Informing the Audit Risk Assessment - Enquiries of Management and Those Charged With Governance pdf icon PDF 138 KB

To consider a letter from the external auditor.

 

To comply with International Auditing Standards, each year our External Auditors need to refresh their understanding of the management processes in place to prevent and detect fraud and to ensure compliance with law and regulation. They are also required to make inquiries of both management and those charged with governance as to their knowledge of any actual, suspected or alleged fraud.

 

The Committee is invited to comment on the letter.

 

Officer Contact: Stephen Nixon on Tel: 234 6362 or email: Stephen.r.nixon@uk.gt.com

Additional documents:

Minutes:

A representative of the External Auditors, Grant Thornton, submitted a report (copies of which had been circulated) outlining their understanding of the Council’s management processes which are in place to prevent and detect fraud whilst ensuring compliance with law and regulation.

 

RESOLVED – That the report be noted.

 

 

7.

Statement of Accounts 2017/18 pdf icon PDF 71 KB

To consider a report of the Borough Treasurer.

 

The report outlines issues relating to the Statement of Accounts.

 

The Committee is invited to comment on the report.

 

Officer Contact: Jonathan Davies on Tel: 218 1025 or email: jonathan.davies@stockport.gov.uk

Additional documents:

Minutes:

The Borough Treasurer submitted a report (copies of which had been circulated) requesting the Committee to consider issues that have arisen during the audit period and to approve the final audited Statement of Accounts as presented.

 

The following comments were made/issues raised:-

·         Councillors commended officers for preparing the Statement of Accounts to a high standard and for their presentation to the Council’s External Auditors on 31 May 2018 meaning that the Council had met the new statutory financial closedown deadline for Local Authorities.

·         The Committee discussed the reasons for the deficit in the Children and Family Services budget and the Adult Social Care budget deficit. Councillors noted that the number of Looked After Children had increased and that there was increased demand on places for Special Educational Need pupils.

·         Plans for a refresh of the Reserves Policy. The Policy also ensures the Council’s earmarked reserves are held at an appropriate level to support the Council’s budget and mitigate the impact of unforeseen cost pressures.

 

RESOLVED – That the Statement of Accounts for 2017/2018 be approved.

8.

Audit Findings Report - Year Ended 31 March 2018 pdf icon PDF 963 KB

To consider a report of the External Auditor.

 

The Committee is invited to consider and comment on the report.

 

Officer Contact: Stephen Nixon on Tel: 234 6362 or email: Stephen.r.nixon@uk.gt.com

Additional documents:

Minutes:

A representative of the External Auditors, Grant Thornton, submitted a report (copies of which had been circulated) presenting for comments the findings of the statutory audit of the Council for year ended 31 March 2018.

 

RESOLVED – That the report be noted.

9.

Internal Audit Progress Report 1 (1st March 2018 - 30th June 2018 pdf icon PDF 58 KB

To consider a report of the Borough Treasurer.

The report sets out the progress made by internal audit against the approved 2017/18 and 2018/19 internal audit plan for the period 1st March 2018 to 30th June 2018.
The purpose of this report is to inform Members of the resources utilised by Internal Audit during the period, the activities undertaken in the reporting period, and the status of work currently being undertaken.

The Committee is invited to comment on the report.

Officer Contact: John Pearsall on Tel: 474 4033 or email: john.pearsall@stockport.gov.uk

Additional documents:

Minutes:

A representative of the Borough Treasurer submitted a report (copies of which had been circulated) setting out progress made by internal audit against the approved internal audit plan for the period 1 March 2018 to 30 June 2018.

 

The following comments were made/issues raised:-

·         The Committee noted that in respect to the Stockport Together programme, the Council had put in place new management arrangements to increase the pace of implementation and improve the quality of care and social work provision.

·         Councillors welcomed the fact that the Risk Manager had been providing significant ongoing support to the GDPR implementation project.

 

RESOLVED – That the report be noted.

10.

Head of Internal Audit Annual Report and Opinion 2017/18 pdf icon PDF 57 KB

To consider a report of the of the Borough Treasurer.

 

It is a requirement of the Public Sector Internal Audit Standards (PSIAS) that the Head of Internal Audit, Risk and Insurance prepares an annual report containing an overall opinion on the Council’s control framework.

The attached report contains this statement and details the audit work undertaken in the year from which the overall opinion has been drawn.

The annual report provides the evidence for the overall opinion and assurance statement of the Head of Internal Audit, Risk and Insurance and his judgement whether there is generally a sound system of internal control, adequately designed to meet the Council’s objectives, and controls are being applied consistently. The overall conclusion is either substantial, moderate, limited or no assurance.

 

The Committee is invited to comment on the report.

 

Officer Contact: John Pearsall on Tel: 474 4033 or email: john.pearsall@stockport.gov.uk

Additional documents:

Minutes:

A representative of the Borough Treasurer submitted a report (copies of which had been circulated) providing details of audit work undertaken throughout the course of the year and overall conclusions in respect to that audit work.

 

The following comments were made/issues raised:-

·         It was suggested and agreed that all Councillors be provided with the opportunity for training in respect to GDPR.

·         The Committee noted that the findings revealed that there was moderate assurance overall and that there was a generally sound system of internal control, adequately designed to meet the Council’s objectives, and controls are generally being applied consistently.

·         Councillors welcomed the fact that there had been no evidence of significant lapses in the internal control framework and that management had responded appropriately and positively to internal audit recommendations.

 

RESOLVED – That the report be noted.

11.

Annual Fraud Report 2017/18 pdf icon PDF 55 KB

To consider a report of the Borough Treasurer.

 

The purpose of this report is to present the work carried out during the past year to minimise the risk of fraud, bribery and corruption occurring in the Council.

This supports the requirements of the Accounts and Audit Regulations (England) 2011, which state that the Council must have measures in place “to enable the prevention and detection of inaccuracies and fraud.” In this context, we have taken fraud also to refer to cases of bribery and corruption.

 

The Committee is invited to comment on the report.

 

Officer Contact: John Pearsall on Tel: 0161 474 4033 or email: john.pearsall@stockport.gov.uk

Additional documents:

Minutes:

A representative of the Borough Treasurer submitted a report (copies of which had been circulated) explaining the work carried out during the past year to minimise the risk of fraud, bribery and corruption and outlining planned work for 2018/2019.

 

The following comments were made/issues raised:-

·         The Committee welcomed the work undertaken with school business managers to educate schools on how to identify and control current and emerging fraud risks.

·         Internal Audit’s data interrogation and analysis software (IDEA) has been used to provide information to managers on potential data quality or fraud issues.

 

RESOLVED – That the report be noted.

12.

Annual Report of the Chair of the Audit Committee 2017/18 pdf icon PDF 70 KB

To consider a report of the Chair.

 

The aim of the report is to demonstrate how the Audit Committee has fulfilled its terms of reference during the financial year and how it is fully committed to helping to improve the Council’s governance and control environments during the year ahead.

Furthermore it outlines how the committee’s activities during the financial year are designed to make a positive contribution to the continual improvement of governance arrangements across the Council, as well as performing the statutory roles as identified in the Constitution.

 

The Committee is invited to comment on the report.

 

Officer Contact: John Pearsall on Tel: 474 4033 or email: john.pearsall@stockport.gov.uk

Additional documents:

Minutes:

The Chair submitted a report (copies of which had been circulated) outlining the committee’s activities during the financial year and how they had contributed to improving the governance arrangements for the Council and performing the statutory duties as required by the Constitution.

 

RESOLVED – That the report be noted.

13.

Anti Money Laundering Policy pdf icon PDF 57 KB

To consider a report of the Borough Treasurer.

 

The Anti Money Laundering Policy is a key cornerstone of effective governance at the Council and supports a wider cultural awareness of counter fraud and how this is embedded.

The aims of the Policy are twofold:-

• To enable the Council to adhere to the Money Laundering Regulations 2017 and the CIPFA Guidance Note – Combating Financial Crime - further guidance on Anti-money Laundering for Public Service Organisations.
• To ensure that those staff most likely to be exposed to or suspicious of money laundering are aware of the requirements and obligations placed on the Council and on them as individuals.

 

The Committee is invited to comment on the report.

 

Officer Contact: John Pearsall on Tel: 474 4033 or email:john.pearsall@stockport.gov.uk

Additional documents:

Minutes:

A representative of the Borough Treasurer submitted a report (copies of which had been circulated) providing for comment the Anti-money Laundering Policy which was a key cornerstone of effective governance.

 

Councillors sought assurance and were informed that employees were made aware of the policy and that information was made available to them.

 

RESOLVED – That the report be noted.

14.

CIPFA POSITION STATEMENT ON AUDIT COMMITTEES IN LOCAL AUTHORITIES AND POLICE 2018 pdf icon PDF 64 KB

To consider a report of the Borough Treasurer.

 

The purpose of this report is to update Members on the latest position statement on Audit Committees from the Chartered Institute of Public Finance and Accountancy (CIPFA).

 

The Committee are invited to comment on the report.

 

Officer Contact: John Pearsall on Tel: 474 4033 or email: john.pearsall@stockport.gov.uk

Additional documents:

Minutes:

A representative of the Borough Treasurer submitted a report (copies of which had been circulated) updating the Committee on the latest position statement on Audit Committees from the Chartered Institute of Public Finance and Accountancy.

 

RESOLVED – That the Borough Treasurer be requested to support a report to the next meeting in respect to the possible appointment of an independent member to the Audit Committee and on how other local authorities in GM had responded to the advice provided by CIPFA.

15.

Update on Corporate Risks 2018/19 (Qtr 1 review) pdf icon PDF 62 KB

To consider a report of the Borough Treasurer.

 

The report identifies and details all current and emerging corporate risks.

 

The Committee is invited to comment on the report.

 

Officer Contact: John Pearsall on Tel: 474 4033 or email: john.pearsall@stockport.gov.uk

Additional documents:

Minutes:

A representative of the Borough Treasurer submitted a report (copies of which had been circulated) providing an update on the current status of corporate risks.

 

RESOLVED – That the report be noted.