Agenda and minutes

To approve as a correct record and sign the Minutes of the meeting held on 30 November 2016.

The Minutes (copies of which had been circulated) of the meeting held on 30 November 2016 were approved as a correct record and signed by the Chair.

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

No declarations of interest were made.

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

No urgent decisions were reported.

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 meeting on the card provided. These are available at the meeting. You can also submit via the Council’s website at www.stockport.gov.uk/publicquestions).

No public questions were submitted.

To consider a report of the Director of Procurement at STAR Procurement.

The report provides an update on the STAR Procurement service.

The Audit Committee is asked to note the report.

Officer Contact: Lorraine Cox on 07817882169 or email lorraine.cox@star-procurement.gov.uk.

Lorraine Cox, Director of STAR Procurement submitted a report (copies of which had been circulated) providing the Committee with information relating to the governance of STAR, the partners, projects and objectives for the future.

The following comments were made/issues raised:-

·         Procurement savings for the Council on the 2016/2017 financial year totalled £1.4 million.

·         A three year business plan for the period April 2017-March 2020 was near completion.

·         An explanation of the governance model with representatives from the three Councils and the role of the STAR Board.

·         The implications of BREXIT, the 2014 EU procurement directives and the 2015 Public Contract Regulations – whatever happens with BREXIT, procurement is already governed by British law. Only bound by EU procurement rules when certain financial thresholds are hit.

·         The contract procedure rules and the thresholds for types of works– the four key treaty principles are applied.

·         The balance score cards as they relate to compliance, performance and social value.

·         Work being undertaken on the insurance tender and how the Council deals with insurance claims – Councillors were keen to hear in future how that work stream develops.

·         Scrutiny of the Digital by Design project. Councillors would welcome a detailed report to be submitted to a future meeting on the project.

·         Contract management is the responsibility of the client department.

RESOLVED – That the report be noted and Lorraine Cox be thanked for her attendance and presentation.

To consider a report of the Borough Treasurer.

The report provides an update on key issues arising for the 2016/17 Statement of Accounts and matters which will form part of Critical Judgements.

The Audit Committee is asked to approve the Council’s proposed Accounting Policies to be adopted in preparing the Council’s 2016/17 Annual Statement of Accounts, and note the updates to the Statement of Accounts and the Critical Judgements that will be used for the preparation of the 2016/17 accounts.

Officer Contact: Jonathan Davies on 0161 218 1025 or email jonathan.davies@stockport.gov.uk.

The Borough Treasurer submitted a report (copies of which had been circulated) providing the Committee with the opportunity to comment on the annual statement of accounts, the proposed 2016/2017 accounting policies and critical judgements.

RESOLVED – That the Accounting principles detailed in the report be adopted for the purpose if preparing the Council’s 2016/2017 Annual Statement of Accounts.

To consider a report of the Borough Treasurer.

The report sets out the progress made by internal audit against the approved 2016/17 internal audit plan for the period 1st November 2016 to 28th February 2017.

The Audit Committee is asked to note the internal audit progress report.

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

The Borough Treasurer submitted a report (copies of which had been circulated) outlining the progress made by internal audit against the approved 2017/2017 internal audit plan for the period 1^st November 2016 to 28^th February 2017 and informing the Committee of the resources utilised by the Internal Audit Service during this period, activities undertaken and the status or work currently being undertaken.

Councillors noted the progress made in respect to a number of on-going pieces of work and the outcomes from final audit reports.

RESOLVED – That the report be noted.

To consider a report of the Borough Treasurer.

The Public Sector Internal Audit Standards require the Internal Audit and Risk Manager to prepare an annual risk-based internal audit plan which takes into account the requirement to produce an annual internal audit opinion.

The Audit Committee is asked to approve the annual internal audit plan and audit charter for 2017/18.

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

The Borough Treasurer submitted a report (copies of which had been circulated) outlining the draft Internal Audit Plan 2017/2018 and the Internal Audit Charter 2017/2018 for consideration by the Committee.

The following comments were made/issues raised:-

·         Councillors noted that the Audit Charter was refreshed and updated each year.

·         Councillors welcomed the report for its comprehensiveness. It was suggested that all Councillors be offered further training in respect to risks associated with social media and technology.

RESOLVED – That the report be noted.

To consider a report of the Borough Treasurer.

The report sets out the proposed arrangements for completion of the Annual Governance Statement for 2016/17.

The Audit Committee is asked to approve the process for completion of the Statement.

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

The Borough Treasurer submitted a report (copies of which had been circulated) setting out the proposed arrangements for completion of the Annual Governance Statement 2016/2017, the final statement would be submitted for consideration to the next meeting of the Committee.

RESOLVED – That the report be noted

To consider a report of the Borough Treasurer.

The Draft Local Code of Governance is reviewed every year and has

been substantially updated following a recent review.

The Audit Committee is asked to approve the process for completion of the Statement.

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

The Borough Treasurer submitted a report (copies of which had been circulated) providing for comment the draft Local Code of Governance which is reviewed on an annual basis. The draft plan had been substantially updated this year following guidance published by CIPFA in April 2016.

RESOLVED – That the report be noted.

To consider a report of the Borough Treasurer.

The report sets out the quality assurance arrangements in place for internal audit for 2017/18 along with the self-assessment results of the QIAP for 2016/17 and the proposed basis that the Internal Audit and Risk Manager will use for the external assessment of the Council’s internal audit function, which is required under the PSIAS.

The Audit Committee is asked to note the QAIP and the results of the self-assessment.

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

The Borough Treasurer submitted a report (copies of which had been circulated) setting out the quality assurance arrangements in place for internal audit for 2017/2018 including the self assessment results of the Quality Assurance & Improvement Programme (QUIP). The report also outlined the proposed basis that the Internal Audit and Risk Manager would use for the external assessment of the Council’s internal audit function.

The following comments were made/issues raised:-

·         Each year a self-assessment is conducted, external assessment takes place once every 5 years with the next assessment planned for June 2017.

·         Part of that external assessment may also include a dialogue with members of the Audit Committee.

·         Services are quality monitored through a Quality Assurance and Improvement Plan.

RESOLVED – That the report be noted.

To consider a report of the External Auditor.

The report provides an update on Grant Thornton’s progress in delivering their responsibilities as the external auditor.

The Audit Committee is asked to note the report.

Officer Contact: Sarah Howard on Tel: 953 6370 on email: sarah.howard@uk.gt.com.

A representative of Grant Thornton submitted a report (copies of which had been circulated) providing the Committee with an update report on progress in delivering on their responsibilities as the Council’s external auditors.

The following comments were made/issues raised:-

·         The interim accounts audit was substantially complete and it was anticipated that it would be concluded by the end of March 2017.

·         The circulation to members of and summary of key decisions made and appropriate additional information as it relates to the Greater Manchester Pension Fund.

·         Councillors discussed issues relating to the crisis of social care provision in the most disadvantaged communities.

RESOLVED – That the report be noted.

To consider a report of the External Auditor.

The Audit Plan provides an overview of the planned scope and timing of the audit, as required by International Standard on Auditing (UK & Ireland) 260.

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

Officer Contact: Sarah Howard on Tel: 953 6370 on email: sarah.howard@uk.gt.com.

A representative of Grant Thornton submitted a report (copies of which had bene circulated) providing for comment the 2016/2017 Audit Plan.

The following comments were made/issues raised:-

·         In respect to the significant risks identified in the report, Councillors enquired when the work would be concluded. It was confirmed that a response would be submitted to the July meeting of the Committee.

·         Councillors discussed the implications for risk associated with the capital projects being undertaken by the Council notably the pooling of budgets in respect to Stockport Together and valuation or property, plant and equipment.

·         Prudential borrowing, the Council’s reserves policy and mitigation measures taken against risk as the risk profiles of the Council has changed in recent years as the Council responds to fiscal challenges.

RESOLVED – That the report be noted.