Agenda and minutes

Venue: Anglia Room, Conference Suite, Elizabeth House, Dereham

Contact: Committee Services  01362 656870

Items
No. Item

45.

Welcome and Introductions

Minutes:

The Chairman welcomed Mr. Leslie Peacock to his first meeting as newly appointed independent, non-voting member of the Committee.

 

Introductions were made and Messrs. Rob Murray and Rob Davies, the Council’s external Auditors were welcomed to the meeting.

 

46.

Minutes pdf icon PDF 67 KB

To confirm the minutes of the special meeting held on 25 June 2009.

Minutes:

The minutes of the meeting held on 25 June 2009 were confirmed as a correct record and signed by the Chairman.

 

47.

Apologies

To receive apologies for absence.

Minutes:

Apologies were received from Messrs. R. Childerhouse, P. Hewett, R. Kybird, D. Myers and R. Duffield (substitute member). 

 

48.

Urgent Business

To note whether the Chairman proposes to accept any item as urgent business, pursuant to Section 100(B)(4)(b) of the Local Government Act 1972.

Minutes:

There was none but the Chairman sought agreement to convene a special meeting of the Committee to consider a commercial property issue.

 

Suggested dates for the meeting were the morning of Friday, 25 September or the afternoon of Tuesday, 29 September.

 

The Auditors were invited to attend the special meeting.

 

RESOLVED that, subject to members’ availability on the suggested dates, a special meeting of the Committee be convened as requested by the Chairman.

 

49.

Declaration of Interest

Members are asked at this stage to declare any interests that they may have in any of the following items on the agenda.  The Members’ Code of Conduct requires that declarations include the nature of the interest and whether it is a personal or prejudicial interest.

Minutes:

No declarations were made.

 

50.

Non-members wishing to address the meeting

To note the names of any non-members wishing to address the meeting.

Minutes:

Mr. P.J. Duigan, Executive Support Member for Governance and Corporate Development.

 

51.

Update on Treasury Management Strategy, Policy and Prudential Indicators (Agenda Item 6) pdf icon PDF 163 KB

Report of the Capital and Treasury Accountant.

Additional documents:

Minutes:

The Head of Finance presented the report and explained that following the cautious approach adopted when this matter was previously considered and bearing in mind the further changes in the market since then, it was felt timely to review the policies again before the end of the year.  Advice had been taken from the Council’s treasury management advisers, Butlers, and the changes recommended in the report should be considered as more in the way of a ‘fine tuning’ process rather than any substantial change of direction.

 

The Council’s advisers, Butlers, were offering to provide training to Council members on investment matters to expand their knowledge and understanding of what was quite a complex subject.  This could be arranged through the Member Development Programme if members wished to take up the offer.

 

The Head of Finance went on to give an update on the Icelandic Bank situation and the latest accounting treatments and referred to the latest guidance issued by CIPFA.  Any changes might not be material to the Council’s Accounts position but would need to be agreed with the Auditor.

 

The latest position on estimates on the recovery rates was noted and considered prudent. Members were aware that there was a lot of general speculation being expressed about recovery rates.  Lawyers acting for the Local Government Association were continuing the process of submitting claims on behalf of UK local authorities and a further update would be able to be given following further creditors’ meetings later in the autumn.

 

The Committee then went on to consider Appendix A of the report, which outlined the main issues explored with the Council’s treasury management advisers.

 

As a first point of principle on the Council’s approach to treasury management, the Committee was asked whether it wanted the Council to continue to place funds with financial institutions, or whether an ultra-cautious approach should be adopted by only investing in the UK Debt Management Office (DMO).  The latter option would come at a price because there was a difference of some £250,000 between what could be earned from the best money market rates and current DMO rates at the present time.

 

Members felt that the Council could still get better returns through the money markets while continuing with its cautious approach and that it was not the best option for the Council to restrict investment to the DMO, which would be like “burying its money in the garden”. 

 

The recommended changes to the Treasury Management Policy were then considered.

 

TMP1[8]: Market Risk Management – It was proposed to amend the policy to specifically state that the Council only uses Money Market Funds with a constant net asset value, which means that the principal sum should remain equal to that invested (compared to a variable net asset value where the principal sum could potentially, though unlikely, be affected by small variations).  This was the Council’s present practice but it was not stated as such in the policy.

 

TMP 2[1]: Performance Measurement – Treasury Management  ...  view the full minutes text for item 51.

52.

Governance Report and Use of Resources (Agenda Item 7)

Verbal update from Audit Commission.

Minutes:

Mr. R. Murray advised Members that he was the District Auditor for the Audit Commission covering authorities in Norfolk and other parts of the East of England, including a number of Health bodies.

 

Mr. Murray went on to explain that he would normally about this time bring a written report advising the Committee of progress on audit work and the use of resources score.  However, the audit was not yet complete and the use of resources was in the final assurance process.   If the Committee was to have an extra meeting as requested above (minute 48/09), it was hoped the Governance Report could be brought to that meeting.

 

So far as auditing of commercial property was concerned, this would be included in the Use of Resources report and would be commented on in the annual Governance Report and in the annual Inspection Letter to the Council.  Mr. Murray explained that he did not expect to have to do anything further than was already being done as part of the normal audit process but should there be a requirement for anything more substantial than this, it would be discussed with the Council.

 

Mr. Davies then gave a brief update on the audit work undertaken during the year, from which it was noted that, subject to completion of the Audit Report, it was anticipated that the Council would be given an unqualified opinion.

 

The question of the timing of meetings of the Committee to accommodate the audit reporting timetable was raised and it was noted that provision was already being made in the calendar for 2010-11.

 

The report was noted.

 

53.

Follow-up of Agreed Actions arising from Final Audit Reports (Agenda Item 8) pdf icon PDF 74 KB

Report of the Head of Finance.

Additional documents:

Minutes:

The report was presented by the Head of Finance, who updated the Committee on the latest position regarding outstanding actions from the last internal audit report.  In those cases not yet completed, revised targets were given.

 

The two main reasons for lack of responses reported previously were the fact that duties had not been re-assigned quickly enough from an officer on long-term sickness and following the departure of an interim manager.  These had now been addressed.

 

Additionally, Audit recommendations had now been incorporated into the Council’s performance management system (the TEN system), with the result that all actions would be reported and monitored through the system and at the quarterly Performance Clinics.

 

The Governance and Performance Accountant added that a meeting was to be held in October at which a number of these items would be dealt with.

 

The Chairman advised the Committee of concerns passed to him by Mr. Hewett, who felt that matters had not progressed sufficiently since the previous report, particularly so far as ICT items were concerned.

 

The Head of Finance replied that the amended deadlines were as proposed by the officers and suggested that, unless the Committee wished to override them, they be taken forward to the next Performance Clinic, who would consider whether they were acceptable.

 

The Committee was also advised that the Council had now appointed a new Emergency Planning Officer who had commenced a programme on disaster recovery, which was planned to be reported in Quarter 3 this year.

 

The Committee was concerned to ensure that actions were not allowed to slip further and that some target dates appeared to be generous.  They felt they were right to raise questions and that Performance Clinic needed to look at these targets.

 

The Head of Finance assured members that the revisions to the following up of actions through the performance management system meant that issues would now be addressed in a timely fashion and not be allowed to slip.  But it was also reasonable to take account of the responsibilities of the new officers in the setting of targets.

 

The Head of Internal Audit pointed out that, under her half-year reporting programme, responses to recommendations would be verified in the first week of October and an update on the status of recommendations provided to the Committee thereafter.  It was thus important to ensure that the special meeting of the Performance Clinic be held in early October to feed into the process and, hopefully, enable a more positive picture to be reported to members in November 2009.  The Governance and Performance Accountant undertook to confirm the meeting date.

 

         RESOLVED that the report be noted.

 

54.

Audit Committee Self-Assessment Checklist (Agenda Item 9) pdf icon PDF 77 KB

Report of the Head of Internal Audit.

 

A copy of the CIPFA toolkit is enclosed as a separate document for Audit Committee members only.

Additional documents:

Minutes:

The Head of Internal Audit presented the report, which provided Members with an opportunity to self-assess the Committee against a checklist provided by the CIPFA Better Governance Forum in their publication “A Toolkit for Local Authority Audit Committees”.

 

The Committee was invited to complete the self-assessment checklist as a means of confirming how far in accordance the Committee was with best practice and to identify where there were gaps in development, so that an action plan could be drawn up to address those gaps.

 

The Committee then went through the checklist.

 

The majority of the items listed in the checklist were answered in the positive.  Areas indentified for further action included the following:

 

  • Induction & other audit training
  • Periodic private discussions with internal audit – in progress
  • Cooperation between internal and external auditors – existing joint working protocol being further developed
  • External audit plans and strategy to be brought to the Committee in future
  • Periodic private discussions with external audit – in progress
  • External auditor’s Governance Report – to be presented to the next meeting of the Committee
  • Performance assessment of external audit – Audit Commission has no process for this as such but Quality Reviews are published on its website, which could be made available to the Committee if wished.
  • Consideration of external audit fee – details to be submitted with external audit plans
  • Inclusion of a standing work programme item on future agenda showing the cycle of reporting in relation to internal and external audit matters, risk management updates, financial reporting updates, statement of accounts, etc. in addition to noting member requests for ad-hoc reports.

 

         RESOLVED that the Head of Internal Audit be asked to collate the replies from the checklist as given and to present overall findings to the November meeting of the Committee, commenting on any non-compliance with best practice and considering what appropriate action needs to be taken as a consequence.

 

55.

Partnership Review Action Plans (Agenda Item 10) pdf icon PDF 24 KB

The last of the recommended Partnership Review Action Plans has been completed and is attached for the Committee’s consideration.

Minutes:

The Governance and Performance Accountant presented the report, which was the last of the action plans as previously requested by the Committee as part of its review of partnerships.

 

It was reported that a report would be made to the next meeting on the outcome of proposals to restructure the Crime and Disorder Reduction Partnerships (CDRP); currently, the Breckland and King’s Lynn and West Norfolk Borough Council CDRP were operated jointly but were to split. 

 

The Chairman felt that a wider review of the value for money of partnerships generally was needed and it was noted that the County Council was conducting a similar exercise with its partnerships.

 

The Head of Internal Audit advised that an internal audit review on that topic had been carried out last year and recommendations made.  There was provision in the Strategic Audit Plan for future review.  The last review had highlighted deficiencies in regard to:

 

  • Register of partnerships
  • Procedures for resolving partnership disputes
  • Financial procedures for partnerships
  • Delivery of partnership objectives/outcomes
  • Performance targets for projects
  • Performance validation and reporting through the performance management system

 

The need to monitor completion of agreed audit recommendations arising from the original partnership review was noted.

 

56.

Quarter 1 Governance Report - Risks (Agenda Item 11) pdf icon PDF 562 KB

Quarterly report.

Minutes:

The Governance and Performance Accountant presented the report.

 

A new section had been added to cover top level risks to ensure they were addressed.

 

Comments submitted by Mr. Hewett were noted which suggested that rather than deleting the three risks listed under strategic and operation risk (R-ICT 02, R-ICT 05 and R-ICT 08), these should be downgraded, since they were all issues which could arise again in some form in the future.  Comments on the writing style of some of the sections in the report were also noted.

 

The Performance and Management Accountant confirmed these points would be taken into account in future reports.

 

         RESOLVED that the report be noted.

 

57.

Next Meeting (Agenda Item 13)

To note the arrangements for the next meeting to be held on Friday, 13 November 2009 at 10.00 a.m. in the Norfolk Room, Conference Suite, Elizabeth House, Dereham.

Minutes:

Arrangements for the next ordinary meeting on 13 November 2009 were noted.

 

It was further agreed that an item be included on future agenda to enable the submission of topics for future debate by members to be agreed.

 

58.

Performance Management System - Demonstration (Agenda Item 12)

As agreed at the meeting on 12 June, to receive a demonstration of the performance management system.

Minutes:

The meeting concluded with a demonstration of the use of the performance management system.

 

The Chairman suggested it would be useful if the system could provide a link for members to be able to submit comments on line.

 

It was noted that work was taking place on introducing an email alert function into the system to flag up items which had missed their target dates.