Agenda and minutes

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

Contact: Committee Services  01362 656870

No. Item


Minutes (Agenda item 1) pdf icon PDF 99 KB

To confirm the minutes of the meeting held on 13 June 2014.


The Minutes of the meeting held on 13 June 2014 were confirmed as a correct record and signed by the Chairman, subject to the following amendments/additions:


a)     Annual Report on Standards Arrangements (Minute No. 22/14):


Mr Stevens said that he had seen no mention of his question asked which had been in relation to whether there were any sanctions in place that could be imposed upon those Parish Councils that had not submitted their Disclosable Pecuniary Interest (DPI) forms; and although the answer had been no, the Chairman asked that this matter should be pursued through Cabinet.


b)     Annual Report on Treasury Management Performance (Minute No. 30/14)


Referring to the final paragraph, Mr Ludlow advised that the pie chart that he had referred to was the non-UK segment.



Apologies (Agenda item 2)

To receive apologies for absence.


Apologies for absence were received from R Childerhouse, R Kybird, B Canham, A Riglar and R Murray.



Urgent Business (Agenda item 3)

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.


The Independent Members left the room for this item of urgent business.


The Assistant Director of Finance advised that the initial three year term of office for the Independent Members had been reached and he asked the Committee whether it wished to re-advertise or offer extensions to the existing appointments.  Members were informed that following some research, the Senior Committee Officer had found that there was no statutory requirement to re-advertise and it was quite acceptable to extend the existing appointments.


The Chairman said that he was quite content with the contribution that the current Independent Members made and felt that their input to the meetings had been excellent and proposed that their appointments be extended for a further three years.


It was agreed that the Senior Committee Officer would write to the Independent Members to inform them of their extended term.


RESOLVED that the appointment of Keith Stevens and Tim Ludlow as the Audit Committee’s Independent Members be extended for a further three years until June 2017.


Mr Ludlow and Mr Stevens returned to the meeting.



Declaration of Interests (Agenda item 4)

Members are reminded that under the Code of Conduct they are not to participate and must leave the room, for the whole of an agenda item to which they have a Disclosable Pecuniary Interest. 


In the interests of transparency, Members may also wish to declare any other interests they have in relation to an agenda item, that support the Nolan principles detailed within the Code of Conduct.





Non-members wishing to address the meeting (Agenda item 5)

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


Ellen Jolly and Mark Kiddle-Morris.



Training (Standing item) (Agenda 6)

To note if there are any training issues/ requests.


Nothing to report.



Economic Development (ED) Service Transformation Phase 1 (Agenda item 7) pdf icon PDF 215 KB

For information.


Councillor Kiddle-Morris highlighted the progress to date in relation to the set up of the Resource4Growth Community Interest Company (CIC).  With the support of the Finance Team all the necessary bank accounts, VAT registrations, insurances and professional indemnities were now in place.


Two contracts had been secured thus far, one with South Holland District Council and the other with Broadland District Council.  Both contracts were being delivered by additional resources that had been procured through Resource4Growth.  A number of further contract opportunities were being explored.


In response to a question, the Committee was informed that the Council was using full absorption costs for charging officer time to the Company.


The update was noted.



Local Government Audit Committee Briefing (for information) (Agenda item 8) pdf icon PDF 5 MB

Report of the External Auditors, Ernst & Young.


The Assistant Director of Finance presented this agenda item in the absence of Rob Murray, the Director for Ernst Young who had sent his apologies.


The Local Government Audit Committee Briefing was a document that Ernst & Young provided for all its authorities for information.  The document covered economic and sector issues that could have an impact on the Council.


The Briefing document was noted.



Progress Report on Internal Audit Activity (Agenda item 9) pdf icon PDF 59 KB

Report by Emma Hodds, Internal Audit Consortium Manager (IACM).

Additional documents:


Emma Hodds, the Internal Audit Consortium Manager, presented the final progress report on internal activity.


The report examined progress made between 28 November 2013 and 16 April 2014 in relation to delivery of the Annual Audit Plan for 2013/14 that included abbreviated management summaries in respect of the audit reviews which had been finalised in the course of this period.


Members’ attention was drawn to the progress report on internal activity that had been appended to the agenda (see page 19).    One significant change that had been made to the Audit Plan since its approval in February 2014 was the audit on Affordable Housing Initiatives (BRK1412) which had been deferred until 2014/15 due to the move to review Breckland’s Planning Policies into a single Local Plan which was not due to be adopted until 2016.  Additionally, there was further work that was still on-going.


The current position in completing audits to date within the financial year had been shown at Appendix 1 of the report and progress date was in line with expectations – all audits had been completed on time.  On completion of each individual audit an assurance level had been awarded using the definitions shown in the table at section 4.1 of the report. 


Members were informed that the Appendix provided an overall view of the assurances awarded.

During the period covered by this report, the Internal Audit Service issued 7 final reports and the Executive Summaries of these reports had been attached at Appendix 2 of the report. In summary, the final reports issued concluded the following:

·              Accountancy Services

A “Good” level of assurance remained in place, indicating a stable control environment which ensured objectives had been met. No high or medium recommendations had been raised.  The Council had sound systems of control in the following areas; Treasury Management, Control Account, Banking, Bank Reconciliation, Asset Register, Budgetary Control and Journal Entries.


·              Anglia Revenues Partnership Governance Arrangements


         A “Limited” level of assurance remained in place due to one high and 2 medium priority recommendations. The high priority recommendation related to the need to develop a mechanism for the reporting of ARP’s risks to the member authorities, including Breckland Council. In addition, two medium priority recommendations had been made in the following areas:


- to ensure an overarching progress report provided a more transparent approach to communicating ARP’s intentions to key stakeholders; and,


- a Service Plan should be developed for 2014/15, including the remaining steps for implementation of the strategic direction, along with clear time frames, resource requirements and assessment of risks.


·        Work to support the Annual Governance Statement (AGS)


Only one low priority recommendation had been made in addition to other work already performed to support the AGS. An overall assurance level was not required for this work. Due to the level of coverage as part of the AGS audits (i.e. the full system was not reviewed, only the key controls), it had not been possible to award a “Good” assurance in this instance. This audit reviewed  ...  view the full minutes text for item 42/14


Status of Internal Audit Recommendations (year end) (Agenda item 10) pdf icon PDF 53 KB

Report by Emma Hodds, Internal Audit Consortium Manager.

Additional documents:


The Internal Audit Consortium Manager presented the report and provided Members with a detailed update on the year end position.


Internal Audit had been aware that the Committee had not been happy with the progress made by management implementing agreed recommendations at the meeting held in December 2013.  Page 51 of the report highlighted the progress made throughout the year for implementing the recommendations of which there were 66.7% outstanding.


Section 2.3 of the report (page 52, also attached at Appendix 2) detailed the high priority recommendations which were outstanding from systems audits. An appendix would usually be attached detailing these outstanding recommendations from IT audits; however, there were currently none to report.


Section 2.10 of the report analysed the high priority recommendations in more detail and out of the seven reported as outstanding in February 2014, two of these had now been implemented: Internet and Email (BRK/12/17) concluded that all recommendations within this audit had now been closed and network Infrastructure and Security (BRK/13/11) had also been closed. 


Of the five still outstanding, Asset Management (BRK/11/06), in relation to street lighting, had since been discussed with management and had been re-worded to more accurately reflect the current situation and would be monitored to a satisfactory conclusion even though this could take further time to resolve.


In relation to procurement (BRK/13/02) there were three high priority recommendations that were currently outstanding, with a further two medium and one low priority recommendation that required attention.  In relation to procurement knowledge, management response had indicated that this was being considered within the structural review currently being undertaken.  In the interim, professional procurement advice was being sought from Procurement Lincolnshire.


Development Control (BRK/14/03) a limited assurance had been awarded on conclusion of this review with six recommendations being raised (I high, 4 medium and 1 low), all of which remained outstanding.  The high recommendation related to Building Control.


A further high priority recommendation that had been noted that was still outstanding was brought to the Committee’s attention in relation to Homelessness and Housing Strategy (BRK/14/06).  This recommendation related to the nature of service delivery performance information and the reporting of this on a monthly basis.  Management responses had indicated that the current system supplier might not be continuing beyond the end of the contract, June 2014, therefore, the recommendation had been put on hold for the time being whilst the service considered its options.


The Chairman asked who was responsible for monitoring these audit recommendations as he felt that this should be the responsibility of the Portfolio Holders.  Members’ attention was drawn to page 55 of the report where it stated that Procurement Knowledge was the responsibility of Vicky Thomson.  Councillor Jolly advised that the person in question had forwarded this concern to the relevant officers.  She explained that the names listed did not necessarily mean that that person was dealing with it as most of the time the subject would be passed down to someone else and therefore the line of responsibility  ...  view the full minutes text for item 43/14


Annual Report and Opinion 2013/14 including Review of the Effectiveness of Internal Audit (Agenda item 11) pdf icon PDF 57 KB

Report by Emma Hodds, Internal Audit Consortium Manager.

Additional documents:


The Internal Audit Consortium Manager gave a detailed overview of the report.  The new Public Sector Internal Audit Standards had replaced CIPFA’s Code of Practice for Internal Audit in Local Government in the UK (2006) and these were very similar to the old Code of Practice in terms of year end Internal Audit reporting requirements.  The report also now contained conclusions of the Review of the Effectiveness of Internal Audit.  This had previously been reported to the Audit Committee as a separate report; however, the view had been taken that these could be considered as one report as they were inextricably linked.  The opportunity had been taken to do this as part of the launch of new report templates across the six authorities that were part of the consortium, with the view to ensuring consistency and streamlining the audit reporting process, whilst ensuring that best practice was met.


It was noted that when considering the report and its attached opinions, the statements made therein should be viewed as key items which needed to be used to inform the organisation’s Annual Governance Statement. 


The Internal Audit Consortium Manager’s overall opinion was that the framework of governance, risk management and control at Breckland Council was deemed to be adequate.  The Council had also received 3 good assurance levels on the conclusion of audits, indicating that there was a sound system of internal control designed to achieve the client’s objectives.


The interim opinion of the previous Internal Audit Consortium Manager as at 28 February 2014 had also been taken into account and this could be seen at Appendix 4 of the report.


On the basis of the audit work undertaken in 2013/14, the Audit Committee approved the Annual Audit Plan for 2013/14, which encompassed 19 audits totalling 232.5 days of work.  Due to amendments to the plan in year, which had been discussed with Senior Management and reported to the Audit Committee in the Progress reports provided in year, the actual work delivered was 17 audits, totalling 209.5 days.  In addition to the Annual Audit Plan, the Audit Management Team had been requested to carry out a final review of the REV Active project and grants claim work; although this piece of work had been undertaken in Quarter 1 of 2014/15, the claims applied to the calendar year – January to December 2013, and the final few months of the claim in 2014.  The work conducted here involved 10 days of extra input from the Audit Management Team.  The Audit Committee had received regular updates from the Team on the project and at the meeting on 13 June 2014 received the closure report which also contained the final audit review of the project.

In relation to the follow up of management actions, to ensure that they had been effectively implemented, the position at year end was that 6 high priority recommendations remained outstanding, 4 of these had been carried forward from previous financial years, 2 of which had been raised during 2013/14. Detailed  ...  view the full minutes text for item 44/14


Annual Report of the Audit Committee (Agenda item 12) pdf icon PDF 95 KB

Report by Simon Craven, Senior Internal Auditor.



The Internal Audit Consortium Manager presented the report and highlighted the Audit Committee’s activities during 2013/14.


During 2013/14, the Committee had met on 6 occasions and attendance had been excellent and use of substitutes had been classed as very good.  There had been a great deal of officer attendance at these meetings and at section 3.3 of the report it highlighted who had been involved in the committee meetings throughout the year.


An overview of the key items considered had also been highlighted at section 3.6 of the report.


Referring to section 3.6.5 of the report, Councillor Nunn asked if this matter of progress against the plan and implementation of recommendations could be enhanced to highlight and reinforce the Committee’s serious concerns of high priority recommendations not been reacted to.   The Chairman said that this was a report of the Audit Committee and there could be an addendum to this report for Full Council to express the concerns raised.  Mr Stevens agreed and felt that it would be to the Committee’s advantage if an addendum was included as at Full Council it would be heard and seen by all. 


The Chairman said that it had been a pleasure chairing this Committee throughout the year.


RECOMMEND to Council that the contents of the Annual Report be approved and the addendum to highlight the Committee’s concerns be noted.



Draft Annual Governance Statement (Agenda item 13) pdf icon PDF 57 KB

Report by the Assistant Director of Finance.

Additional documents:


The Assistant Director of Finance presented the revised draft Annual Governance Statement that had been circulated prior to the meeting.


Councils had a responsibility for reviewing the effectiveness of its governance arrangements with the review informing the Annual Governance Statement.


The revised report had been circulated to reflect the comments and opinions from the Internal Audit Consortium Manager’s Annual Report and Opinion.  If this amendment was accepted, it would be included in the papers issued for audit by Ernst & Young along with the Statement of Accounts.


Mr Ludlow said that the word ‘new’ needed to be removed when mentioning the shared management arrangements as, in his opinion, this arrangement was no longer ‘new’.  The Assistant Director of Finance said that this word would be removed.


RESOLVED that the revised Annual Governance Statement be approved.



Local Code of Corporate Governance 2014/14 (Agenda item 14) pdf icon PDF 58 KB

Report by the Assistant Director of Finance.

Additional documents:


The Assistant Director of Finance advised that the Council had prepared a Local Code of Corporate Governance which was consistent with the revised CIPFA/SOLACE guidelines.  The Code demonstrated the ways in which the Council would achieve good corporate governance.  Breckland’s proposed Local Code had been set out at Appendix A of the report and had been revised in a more succinct way to reflect the changes to the guidance as well as changes to the way the authority operated.  The Code also recognised the partnerships that Breckland Council had in place.


A concern was raised in relation to Core Principle 2 where it was asked to ensure that this covered the new standards arrangements in place.


RESOLVED that the revised Local Code of Governance be adopted.



Work Programme (Agenda item 15) pdf icon PDF 54 KB

A copy of the Committee’s work programme is attached.  The Committee is asked to consider whether any additions, deletions or amendments to the programme are required.


It was agreed that the Internal Audit Consortium Manager would email the Audit Committee’s Self Assessment Exercise and Action Plan to Members in advance of the September meeting so that it could be dealt there and then rather than having to bring it back again to the December meeting.


It was agreed that the Audit Committee Self Assessment Exercise and Action Plan be removed from the Work Programme for the December meeting.



Next Meeting (Agenda item 15)

To note the arrangements for the next meeting to be held on Friday, 26 September 2014 at 10.00am in the Norfolk room. 


NB: A private meeting between the Audit Committee and internal and external Audit Managers will be held prior to this meeting outside of the meeting agenda.


The arrangements for the next meeting on Friday, 26 September 2014 at 10.00am in the Norfolk room were noted.


The private meeting between the Audit Committee and Internal and External Audit Managers would commence at 9.00am.