Agenda and minutes

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

Contact: Democratic Services  01362 656870

No. Item


Minutes (Agenda item 1) pdf icon PDF 115 KB

To confirm the minutes of the meeting held on 13 February 2015.


The Minutes of the meeting held on 13 February 2015 were agreed as a correct record and signed by the Chairman.


It was further agreed that an additional item called ‘Actions arising from the Minutes’ would be added to the agenda as a standing item in future.



Apologies (Agenda item 2)

To receive apologies for absence.


Apologies for absence were received from P Hewett, K Stevens and M Taylor.


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.




Declaration of Interests (Agenda item 4)

Members are reminded that under the Code of Conduct they are not to participate in 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 that they have, in relation to an agenda item that supports 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.




Training (Standing item) (Agenda item 6)

To note if there are any training issues/ requests.


The Finance Manager advised that Treasury Management training would be arranged later in the year.



Annual Audit and Certification Fees Letter 2015/16 (Agenda item 7) pdf icon PDF 921 KB

Report by the external Auditors, Ernst & Young.


Rob Murray, a Director for Ernst & Young (E&Y) explained that the self-explanatory letter confirmed the audit and certification work that E&Y proposed to undertake for the 2015/16 financial year. 


It was noted that the scale of fees had been reduced by 25% for 2015/16 following the further tendering of contracts in March 2014.


The Annual Audit and Certification Fee Letter for 2015/16 was otherwise noted.



Local Government Audit Committee Briefing (with questions) (Agenda item 8) pdf icon PDF 4 MB

Report by the external Auditors, Ernst & Young.


For the benefit of new Members, Rob Murray explained that this was a regular briefing that external audit provided that may be of interest to the Committee.


Ernst & Young had just published the latest Briefing which would be forwarded to Democratic Services to circulate to Audit Committee Members.


Attention was drawn to the section on ‘Annual Reports and Accounts – lessons from the private sector’ on page 14 of the agenda which highlighted the forthcoming issues for local government.  Members would be informed of these changes at the appropriate time.


Referring to the section on ‘Highly Paid off-payroll Appointments’ on page 15 of the agenda, it was explained that HRMC would be visiting local authorities to establish what arrangements they had in place.


Emma Hodds, the Internal Audit Consortium Manager confirmed that this area had recently been covered in the payroll audit and that this authority recognised the risk and had controls in place.



Progress Report on Internal Audit Activity (Agenda item 9) pdf icon PDF 12 KB

Report by the Internal Audit Consortium Manager.

Additional documents:


Emma Hodds, the Internal Audit Consortium Manager presented the progress report on internal activity made between 27 November 2014 and 12 May 2015; the final report for the year.


To comply with the Public Sector Internal Audit Standards, the report included:

1)     Any significant changes to the approved Audit Plan.

2)     Progress made in delivering the agreed audits for the year.


3)     Any significant outcomes arising from those audits; and

4)     Performance Indicator outcomes to date.


A detailed overview was provided.

Two further changes to the Audit Plan were highlighted these had been addressed and would be incorporated in the 15/16 Plan.


Internal Audit Services had issued eight final reports and the Executive Summary had been summarised at section 4.4 of the report.


Three high priority recommendations had been raised in relation to affordable housing and all had since been actioned by management.


Housing Benefits, Council Tax Benefits and National Non-Domestic Rates were provided through the Anglian Revenues Partnership (ARP), the internal audit of which was undertaken by West Suffolk Audit Services.  The reviews had been completed and as a result a “substantial” level of assurance had been awarded with overall conclusions detailed in the report; a very positive conclusion for end of year.


RESOLVED that the outcomes of the 11 completed audits finalised in the period covered by this report, and the completion of the 2014/15 Annual Audit Plan be noted.        






Follow Up Report on Internal Audit Recommendations (Agenda item 10) pdf icon PDF 12 KB

Report by the Internal Audit Consortium Manager.

Additional documents:


Emma Hodds, the Internal Audit Consortium Manager presented the report.


There had been quite a significant amount of activity prior to the year end with only 10 recommendations outstanding and by September all would be addressed.  Only one high priority recommendation remained outstanding which was in relation to the disaster recovery plans; however, this was fully expected to be closed down soon.  This was, in the opinion of the Internal Audit Consortium Manager, a very encouraging end to the year.


Julie Kennealy, the Executive Director of Place and S151 Officer pointed out that the Council now had a robust disaster recovery plan and that this Council was now PSN compliant. The IT Team had worked extremely hard and had worked closely with Norfolk County Council.  It was noted that this information would have an impact on the Audit Opinion.


Mr Ludlow felt encouraged that this ‘sweep’ that had been carried out had cleared the backlog.


Councillor Nunn advised that Councillor Hewett had sent in a fairly full list of questions and asked if they were going to be answered.  The Chairman felt that as there were so many questions they should not be dealt with at the meeting and the officers would respond directly to Councillor Hewett outside of the meeting.


RESOLVED that the contents of the report be noted.



Annual Report and Opinion 2014/15 (Agenda item 11) pdf icon PDF 17 KB

Report by the Internal Audit Consortium Manager.

Additional documents:


The Internal Audit Consortium Manager stated that the Annual Report and Opinion was the most important paper to the Audit Committee.


Page 72 of the agenda highlighted the opinion itself which had been deemed as ‘adequate’ (see paragraph 2.2 of the report) and paragraph 3.5 to 3.6 was where the update could be seen.   Paragraph 3.5 was in relation to the disaster recovery plan as highlighted in the previous agenda item.  The IT department had worked tirelessly over the last six months and the progress on the Disaster Recovery Plan and achieving PSN compliance meant that those issues should no longer have to be reported in the Annual Governance Statement.


A further part of the report related to the effectiveness of internal audit which was set against certain standards (see section 5 of the report).  Members were informed that in relation to the Attribute Standards it had been recognised that in order to achieve full conformance an external assessment would be required.  This assessment would be undertaken in January 2016.  As far as performance indicator outcomes were concerned the work that should have been closed down by Mazars had now been closed down.


Finally, section 5.3 of the report referred to the effectiveness of the Head of Internal Audit, Emma’s role.  Her work was being forwarded to Julie Kennealy and Mark Finch, the Council’s Finance Manager for an independent assessment.


Mr Ludlow felt that paragraph 3.5 and 3.6 should be removed now that this work had been completed.  Members were informed that the paragraphs would be amended not removed and the report would be updated accordingly.


RESOLVED that subject to the aforementioned amendments:


1.     the contents of the Annual Report and Opinion of the Internal Audit Consortium Manager be approved;


2.     the adequate audit opinion that had been given in relation to the framework of governance, risk management and control for the year ending 31 March 2015 be noted;


3.     the opinions expressed together with significant matters arising from internal audit work contained within the report be given due consideration and noted when developing and reviewing the Council’s Annual Governance Statement for 2014/15; and


4.     the conclusions of the Review of the Effectiveness of Internal Audit be noted.



Annual Report of the Audit Committee (Agenda item 12) pdf icon PDF 20 KB

Report by the Internal Audit Consortium Manager.


The report summarised the work of the Audit Committee during 2014/15 and confirmed that it had operated in accordance with its Terms of Reference and had complied with best practice as detailed in the publication ‘A Toolkit for Local Authority Audit Committees’ and demonstrated effective challenge during its five meetings in the year.


Members noted the information.


RECOMMEND to Council that the contents of the Annual Report of the Audit Committee be noted.



Treasury Management Performance Report 2014-15 (Agenda item 13) pdf icon PDF 71 KB

Report of the Executive Director of Place & S151 Officer.

Additional documents:


Alison Chubbock, the Accountancy Manager presented the Annual Report.


The Council was required through regulations issued under the Local Government Act 2003 to produce an annual treasury report reviewing treasury management activities and the actual prudential and treasury indicators for 2014/15.  This report met the requirements of both the CIPFA Code of Practice on Treasury Management (the Code) and the CIPFA Prudential Code for Capital Finance in Local Authorities (the Prudential Code).


Members were being asked to approve the actual 2014/15 indicators within the report.  Members training on treasury management issues would be provided later in the year.


The Council had complied with all the regulatory requirements and therefore there were no issues to raise.


Appendix A included an update from the Treasury Management Advisors, Appendix B of the report highlighted all the prudential indicators that were being forwarded to Full Council and Appendix C was for information only.


Mr Ludlow queried the £7m figure under section 3.5 of Appendix A and asked if this was a typographical error.  Members were informed that this was not an error as this sum of money had been set aside for the Riverside development in Thetford.


The Chairman asked if Greece posed any threats and asked if there would be any political ramifications for Breckland.  The Finance Manager explained that Breckland Council had no direct investment with Greece but the counter party ratings could be threatened if the European situation changed.  Regular updates were being provided by the Treasury Management Advisors.


Councillor Nairn asked a question in relation to the Icelandic monies.  Members were informed that some money was still awaited from Kaupthing Singer & Friedlander (KSF) which was being administered through UK Insolvency Regulations.  There were still some monies being held in an Escrow Account in Iceland which would eventually be repatriated when capital controls were lifted.


The Executive Director for Place & S151 Officer referred to the counter party ratings mentioned earlier and pointed out that the biggest risk was our own banks.  The credit agencies feared that the Government itself may sell its shares because the banks were now stronger which could then downgrade the credit ratings as those banks no longer received Government support.  It was noted that Lloyds Group had already been downgraded.


The Chairman felt that with interest rates being low it brought investments down too.   Members were informed that interest rates were at their lowest and that the Treasury Management Advisors had advised that interest rates could start to rise next year.  The Executive Director of Place & S151 Officer pointed out that holding cash in the banks was the most inefficient use of the Council’s money and a decision to spread Breckland’s investment base would be coming forward to Full Council.


RECOMMEND to Full Council that:


1.     the actual 2014/15 prudential indicators be approved; and


2.     the Treasury Management Stewardship report for 2014/15 at Appendix B and Appendix C of the report be noted.



Draft Un-audited Statement of Accounts 2014-15 (Agenda item 14) pdf icon PDF 82 KB

Report of the Executive of Place & S151 Officer.


A short presentation will be provided.


Due to its size, the Draft Statement of Accounts is attached as a separate document.

Additional documents:


The Accountancy Manager presented the report and provided Members with a detailed overview of the draft un-audited Statement of Accounts.  A short presentation was also provided.


The Accounts and Audit regulations would be changing in the near future.  The new regulations for the 2017- 2018 Statement of Accounts required that:


·        The Responsible Financial Officer signed the un-audited Statement of Accounts no later than 31 May each year (one month earlier); and

·        The Statement of Accounts be considered and approved by a Committee of the Council no later than 31 July each year (two months earlier).


In order to plan for meeting these deadlines in future, the Statement of Accounts for 2014-15 had been completed earlier than currently required and signed by the said Responsible Financial Officer on 1 June 2015.  Ernst & Young then commenced the audit of the accounts to report to Members at the Audit Committee on 31 July 2015; thus meeting the future requirements.


Mr Ludlow referred to the usuable reserves and asked if any of the grants were repayable.  The Accountancy Manager explained that capital grants did not get repaid but the grants with creditors may have to be repaid if the conditions were not met.


In response to a further question in relation to the council tax collection figure, Members were informed that this figure was slightly different to the previous year for the reason that some customers had moved from a 10 month payment plan to a 12 month payment plan.


Mr Ludlow had noticed that the housing benefit overpayments were on the increase and he asked if there was anything in place to ‘claw’ this money back.  The Accountancy Manager explained that the overpayments had increased more than other years due to a new system that had been put in place by HRMC (Real Time Information). The bulk of the debt went back 3 or 4 years and the balances outstanding prior to this were relatively small; however, recent statistics had shown that of the balance outstanding at 31 March 2014, 30% of it had already been collected in the last year. The Chairman was pleased that HRMC was better at spotting these issues than in previous years.


It was noted that Mr Ludlow questions that he had asked prior to the meeting in relation to the draft Statement of Accounts had been addressed.


RESOLVED that the draft un-audited Statement of Accounts for 2014-15 and the Annual Governance Statement (AGS) be noted.



Work Programme (Agenda item 15)

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.


The following changes were made to the Audit Committee Work Programme:


·       Audit Committee Self-Assessment Exercise and Action Plan to be moved from the 25 September meeting to the 19 February 2016 meeting.

·       Annual Audit Letter to be brought forward from the 11 December 2015 meeting to the 25 September 2015 meeting (as per email from Rob Murray tbc by Alison Riglar).


Mr Ludlow mentioned the Intellectual Property Working Group that should have been set up (see action under Minute No. 13/15) as it seemed to have disappeared off the radar. The Executive Director of Place & S151 Officer explained the background of why the set-up of the Working Group had been suggested.  It was agreed that an update would be provided at the next meeting.<1>



Next Meeting (Agenda item 16)

To note the arrangements for the next meeting to be held on Friday, 31 July 2015 at 10.00am in the Norfolk Room.


The arrangements for the next meeting on Friday, 31 July 2015 at 10.00am in the Norfolk Room were noted.