Add Audit Committee Charter Autograph with airSlate SignNow

Add Audit Committee Charter autograph

[Music] [Music] [Music] [Music] [Music] those everyone ready yet yes though thank you good evening uh thank you all for attending the virtual meeting of the audit committee as chair i'd like to welcome members council officers and any members of the public who might be viewing the meeting remotely tonight before i begin i'd like to address some housekeeping measures to make the meeting hopefully run as smoothly as possible we have some legal considerations to note uh firstly that the meeting is being held in accordance with the local authorities and police and crime panels coronavirus regulations of 2020 it will also be conducted according to the council's standing orders for remote meetings and those set out in the constitution however should there be any conflict between the standing orders and the 2020 regulations then the 2020 regulations will take precedence secondly some practical issues the agenda and papers for the meeting are available on the council's website via the committee information pages i shall introduce each item on the agenda and what core speakers one by one i would ask when speakers or those participating on not speaking all of them in the meeting mute their microphones it's expected that matters will be agreed by consensus where necessary however if there is a vote i shall undertake a roll call if the meeting becomes incorrect or it's not accessible to the public on youtube then i will adjourn the meeting for a defined period to allow for reconnection if access cannot be restored within a reasonable period then the remaining business will be considered on another day so to proceed and confirm that we have a quorum i will do some introductions and call each committee member in attendance one by one to introduce themselves and to confirm that they can see and hear the proceedings so i'm andy green i'm the independent member and chair of the audit committee i'd now call on the following council members to confirm their attendance and in doing so confirm that they can see and hear the proceedings so councillor saab council council rasa for the paddock board i can see and i can hear thank you councillor joel councillor sacho harper streetly ward i can see in here thank you councillor fitzpatrick council if it's patrick for blocks which east ward i can see and i can hear and councillor robertson councillor ian robertson black norward i can see in here okay so i believe we have a call for the meeting and we may proceed we do have members numbers of officers in attendance to support the meeting and i should be grateful if they could introduce themselves when they are asked to speak but for the time being remain muted and uh invisible to the meeting please okay so agenda item one a welcome and apologies so nikki have we received any apologies at all councillors young and counselor gazelle thank you the second item of the minutes of the meeting held on the 23rd of november 2020. the minutes are accurate after accuracy only and not for comments um this item does require a roll call as the decision is required whether we move and second note that movement so i shall ask each member first are you happy with the accuracy of the minutes chair cancer assad uh i think i've been missed from i was present in the meeting but i've been i haven't my name hasn't been recorded present of the meeting on the 23rd of november okay thank you are members happy that that amendment is taken on board councillor robertson yes cancer yes council fitzpatrick i'm happy with the amendment going ahead i wasn't present thank you okay subject to those amendments if that's the only amendment i'd like then for each member to confirm whether they take the meet the minutes as has read uh councillor yes i'm in favor chair thank you council robertson agreed cancer joel yesterday so agreed thank you thank you and cancer fitzpatrick although you weren't there we need you to say yeah well i will abstain then bin as i wasn't at the meetings thank you declarations of interest do any members have any declarations of interest in the united item council staff you've got you that's fine thank you so no declarations of interest nikki are there any deputations and petitions none received okay item number five uh the local government access to information act 1985 as amended i would ask members in the public to note that item 12 contains exempt information under the local government access to information act of 1985 a hereby move that we enter private session at the conclusion of agenda item 11. i should now call each member to ask that you agree or disagree with that movement cancer robertson agreed cancerous arb agreed cancer fixed patrick agreed that's a job agreed thank you very much we now move on to some of the business of the the meeting the actual business so item number seven is become a standing item now for the committee and it's the decision tracking chart it doesn't require a formal decision it has been modified somewhat since the last meeting and i hope that is helpful to all the members to officers as well and to the public so they can see what business the committee has been undertaking and it helps the committee undertake just to assess where it is with various items that it's gone through unless there are any queries i shall move on nikki do you want to say something yes apologist chair um it may have been missed off the chair's agenda but there's items that notification of any issues of importance i'm sorry can we can we take item seven first as we finish or do you want me to go back and see yeah that's fine so we'll conclude item seven if there any other queries no and we'll go back to item six on the agenda sorry nikki thank you are there any issues of importance for consideration at future meetings council robertson i didn't raise that with you chair about some possibility of monitoring the spend uncovered by the various grants and things i'm sure that that's gone through the system but it may be quite good to examine that at some stage in view of the nationally there's been quite a lot of controversy about misuse of funds or non proper claiming et cetera okay i think if if i might need to bring deborah hinson into this the section 151 officers but my my view is that it's appropriate for us to consider the controls around how covered spending is approved or otherwise by the council and it might be that in that we can see a list of items a list of expense expenses made but we might need to consider further then how that is being managed within those controls and and the detail behind that might be something that we might need to take to another committee for instance like a scrutiny committee but let me call in either vicky buckley or deborah hinson on that vicky you've got yeah yeah i'm happy to take that chair yes we're reporting on a regular basis in terms of all kobe related spend and loss of income um due to facilities closure on a regular basis to cabinet those reports actually internal from and we're doing that from a corporate perspective and a service-based perspective additionally the service corporate financial performance and the overview of the council's performance or is also reported to scrutiny on a regular basis so scrutiny are already receiving those reports in respect of audit committee there are several items on the work um the work program for the internal audit program for this year including um one which has just been um issued in draft in terms of provider payments which is part of the the covered spend and additionally around kobe controls so excuse me there is a draft report that's just been issued in respect to that and you'll be receiving that in your next meeting so you can consider the controls in place with respect to kovid's spend and expenses at that point council robertson are you satisfied with that yes i think it would be very helpful to have that open open transparent because yeah you know there's been all kinds of rumors about people are claiming the wrong things and claiming things when they shouldn't do et cetera and it's an awful lot of money i think we should be uh prudent to actually look at it okay and i'm i'm comfortable with that council robertson i think it's a very good point that you've raised and i'm i'm pleased the officers have taken that on board so we'll we'll see that at the meeting in april vicky or will there be the opportunity for the ad the for that to be received at the adopt meeting in march i'll check that out with sarah because obviously we've generally just issued the internal audit reports due to receiving hyper but if we can bring it forward to the march then we will do okay thank you our members happy with that yeah okay thank you and thank you nikki for the uh for the opportunity to um deviate from the agenda there thank you item 8 is the internal audit progress report and for 2021 with the uh key performance indicators i believe we've got is lloyd with us and sarah sarah's here sarah knowles yes i'm here chair as well and lloyd lloyd haynes is with us as well so over to yourselves and thank you as uh the chairs indicated there are two parts to this report and so i will cover the the first part which is in relation to the key performance indicators of the internal audit contract and then sarah will jump in to cover the internal audit progress so in terms of the covering report itself and that separate table one progress against the key performance in indicators you'll see from table 1 there is only one key performance indicator that we aren't meeting at present which is in relation to completion of audit work within six weeks of the commencement and there are two audits there where we've been just slightly outside of the six week time frame at 33 and 34 days respectively which were both due to requesting additional information at review stage the second table in the covering reports just under paragraph 6.4 sets out the performance standards for the contract and again we are meeting performance standards in all areas apart from one which is around producing draft reports which reflects the agreed brief and we reported back at quarter one that there was a um slight under performance in that area in relation to two audits where there was a slight delay due to covid and remote working at that point and then following that in quarter three we've seen in another two audits in the same area where the delay due to temporary absence of the internal audit manager and the need to put additional management cover in place during that period so it's only that and members would should also note in terms of um the performance indicators themselves there was quite a a useful dialogue at the last meeting around amendments to kpis following the renewal of the external audit externalized internal audit contract with mazars and the kpis and performance indicators as set out that we've just covered have indicated have incorporated the feedback from um panel members at the last meet as well to ensure that there are maximum time periods and against each of the kpis and performance standards so that's the overview of the kpis and if there are any questions on that before we hand over to sarah in terms of the internal audit progress so any counselors have any queries on that first part of the report no it's good to say that you've amended the performance indicators lloyd and sarah thank you hope those will prove beneficial as we move forward and sarah can you take us through your part of the report which is progress on the internal audit plan yes um the thing to note on progress is that it's still with plan we haven't needed to deviate um from progress is still going well we're still working remotely obviously in the current circumstances so um uh things are slightly different so there are sometimes delays to the way that we're working in terms of the information that we're gathering but um we are getting all the information that we need for our audits so there hasn't been anything that's been impacted by the way that we're working and so that that is good um i'll just take you to page 39 um of the probe of the the pack which summarizes the reports that we've issued since the last committee meeting um i think it's worthwhile drawing your attention to um the payments to suppliers piece because we we don't often get um good assurance in both the uh the evaluation and the testing side of a piece of work that we do so i think it's worth pointing out that this piece of work was specifically done um because of a covid guidance that was put in place back last march april and then we followed those guidance notes all the way through because they were effective until the 31st of october in terms of the way that the council was paying suppliers in accordance with those government guidelines so um so hopefully the committee will be assured that we've got good assurance for for that piece of work which will um obviously feed into the other code work that we're doing um to give assurance on the controls that are being put in place specifically around covid so i thought that's worth mentioning given that we don't tend to give good assurance reports that often um moving on to the next page that um summarizes the follow-up situation um as you can see we're we're getting there in terms of outstanding um audit recommendations from from years gone by and the second table is is particularly important that we're down to very few really priority one recommendations which will be discussed later on in the meeting um the next few pages just just highlight where we are in terms of plan progress i haven't got anything more specific to point out um to the committee so if there are any questions happy to take noise okay sarah thank you and that sounds like given the restrictions that are in place in terms of the ways of working that's uh that's a very positive report that we've received and as you say it's good to see uh that particular aspect on on payments to suppliers is very very encouraging so thank you cancer robertson yeah thanks for that report sarah i mean it must be incredibly difficult to actually do this internal audit you know given all these various restrictions and things i mean has that really been a problem you know i mean it's all presumably done online with little teams meetings and things exchanging information by email but it must be very very difficult to actually um battle through all those figures and and to actually liaise with the various people concerned and as i said it is causing slight um it's taking slightly longer to do some of the pieces of work just because people are obviously their time is is tied up with with more important things really than than us sometimes um which is completely understandable given the current climate but um but we are still getting really good cooperation and we've as i said there hasn't been anything that we haven't been able to find to complete our work so we haven't had to um haven't had to amend scopes or anything like that so far so that's that's really good sarah can i just follow that up please if i might i i'm aware that we've got our external auditor with us uh on this meeting i'm assuming that our external auditor is satisfied with the the approach that you're taking in terms of internal audit matters so that they can place as much reliance upon your findings in terms of their final end-of-year decision is that something that either you or richard could mention please i'm i'm quite happy to comment sarah if that's that's okay and certainly in terms of the audit that's just just gone gone by the the 1920 hold it for us no no problems or issues at all very comfortable with the coverage that internal audit provided or albeit that the latter you know as we were getting to the end of that year things were starting to get a bit knocked about this year's obviously a bit of a different uh situation uh 2021 and we've yet to carry out our detailed planning but there's certainly no indication from the from the progress report that you've been given there's no indication uh for us of any issues that that we need to be concerned about i mean the obvious thing that we'd be looking for are reports that internal audit is struggling to complete because they can't access people and the whole program being delayed and as sarah has said and you know to re-emphasize it's good to see it good as well so you know i just feel pretty positive about it to be honest that's wonderful thank you and and thank you for that assurance richard that's quite important for the community to understand and take forward so thank you are there any other questions to say on any aspects of her report cancer robertson we still i would that um the the audit fee has gone up for an external order for nineteen thousand pounds i presume that's being there because of the difficulties of contact etc but more time involved in doing all the various meetings and things um it's actually not related to this but richard you you please answer it anyway yeah it's like a chair all i was going to say is uh when i talk about the audit letter in the wild alex i'll explain the circumstances and and that is part of the issue but not not the whole issue okay thank you thank you sarah can i just uh ask a couple of questions please the um obviously audit recommendations that you make sometimes get slicked slippages for very good reasons can you just assure us that when officers stroke directors are seeking either a deferral a postponement or a recommendations agreed action plan to be slicked you're satisfied with that yourself in terms of the reasonableness and it's not just a fate accompli on behalf of officers or directors yes yes absolutely and actually what we've we've talked about um the last couple of weeks i've been having my planning um discussions with executive directors for the plan for next year and because we've noticed there's one particular piece of work where we have been going back time and time again in terms of trying to find out whether the recommendations have been implemented we are actually going to include that piece of work in the 122 plan so we'll have them a complete look at what's going on in that area so yeah will you be able to include some reference to that in your next report to committee then please yeah yeah yeah i think it's uh it's quite important for the committee to make sure that things like this aren't slipping too far back and you you adequately provide us with an analysis of where the recommendations are but i think once we're moving into two to three years slippages we we ought to start feeling a little bit concerned so thank you for that any other queries from any other member no can i move on to agenda item nine then now uh and we're back with sarah again this is the uh strategic risk register under the risk management update so sarah over to you yes this uh this report says that the recent risk management activity that's been happening across the council and provides you with an updated strategic risk register as a result of that activity and cmc have reviewed and agreed the changes to the risk register and you'll see from section 6 on the covering report that we've put some detail there about what has actually changed from the last risk register um i think the main main points to note uh that risk four has been split out into two parts part a and b which um cmt feel better reflects the different activities within children's services and adult social care and so hopefully that gives a little bit more clarity as to the controls and the actions that are taking place in in the two directorates um the previous risks eight and nine have been incorporated into risk seven which has um has certainly yes has changed quite a lot over the last 12 months as you can imagine um and we've got a new risk on cyber security which comes into the risk register and also as requested by the committee last time the distinction between controls and assurances has been made clearer so hopefully that that has addressed that question from last time so those are those the only things that i need to point out um [Music] thank you thank you sarah any queries from members at all no cancer fits patrick council fitzpatrick here on moot i think apologies okay can i ask it obviously we've seen um um one where we've seen the writing um rise um i think it's risky six regarding community cohesion where the uh risk is lowered can can i ask what mechanism um implies set that off please and this this is um has been reviewed by um the executive director for resources and transformation in terms of the activity over the last 12 months so it's um it's where the existing controls are felt to actually better mitigate the risks that have been documented on the side and then any actions that are likely to take place going forward have then reduced um or likely to reduce it even further to to the target score for that particular risk cancer fitzpatrick are you happy with that yes yes that's fine thank you thank you cancer robertson yeah i noticed that risk seven is going up and it's red as we are at the moment which sort of enough ringing alarm bells i know the pro the proud program has been seriously uh had um modified et cetera but what measures are you taking to actually tackle that um again this this is an assessment of where the directorates feel they are at the moment in terms of oh sorry not the director of the strategic risk register where cmt feel they are at the moment in terms of navigating that risk so you'll see in the existing controls column all the things all the activity that are in place at the moment um obviously sometimes there's very little action that you can you can do to mitigate risk it's not always going to be able to to mitigate it down any further um but there is a lot of activity um particularly around this risk as you see finances are incredibly important at the moment um always so it's this you'll see that there's a whole raft of existing controls that have been documented here that that is action that is going on at the moment in order to to keep that that risk under control cancer robertson are you comfortable with us yes thank you i'm going to write another one about uh risk number five that mentioned brexit had very helpful kind of briefing about the effects of brexit although things like um the problems of employing um have employees from abroad we don't have actually too many people who are from the european community and i don't think the the things change until about july i believe from the briefing paper so um well there's any other issues about you know the brexit risks sarah can you comment on that or would you do you want one of the officers to comment deborah or vicky for instance happy for somebody to to answer more specifically because i obviously only got an overview um in terms of where the risk is currently against the controls so happy for somebody else to answer could i ask vicky to um come into the meeting vicky buckley she's there deborah deborah i see you deborah or vicky i don't mind which one um i'll do it vicky because i think um so the on the brexit specifically we have um i've done a significant amount of work in terms of identifying the risks when the briefing was done it was before there was um uh a deal as such so we were sort of thinking about the implications of no deal the brexit group is ongoing and there are a whole series of actions in the risk register which we do for completion by december which we're just following up we're not identifying any specific risks that aren't um under control i think there are obviously risks around brexit because of you know what brexit is in terms of some of the implications which are captured in the risk register but i think it's under control from an officer a point of view okay thank you deborah cancer robertson are you comfortable with us yes thank you yeah i mean the important thing on this is that we'll keep this is on the strategic risk register so we will be able to keep our eyes on this and and watch how things move um are there any other queries to write to sarah sorry no sarah could i just ask a couple of queues first a note items eight and item nines the original risks have been included into item seven yes but as i'm reading it certainly item nine seems to be a different sort of risk to item seven so i'm i'm struggling to understand the rationale as to why item nine which was the impact of a reduction in health and social care budgets which is a reduction in health and social care budgets should now fall under the banner of failure to achieve the savings required and it was felt that risk 7 was much more of a financial risk right across the council and in terms of demand pressures as well as um savings so it was it was felt that it would better be incorporated into just one strategic risk regarding finances as a whole across the authority okay i i can say council robertson's got his hand up and i hope he's he might be on the same wavelength as myself but my concern there is that we we're ignoring what the potential risk of a reduction in the public health budget is as opposed to the wider issue of financial savings so if that's very challenging for me is a really important thing lloyd i can see you there but can i ask cancer robertson for his view or comments on that yeah i very much agree i mean the the problem is we've got a 10 increase in the um number of elderly people 10 percent rise in the number on the religion by 2024 i believe it is of course now that puts enormous strain on on social care budgets yeah and i can see part of that in terms of item seven but what about the public health budget the re the public health budget is that that was originally devolved under the 2012 health and social care act belief to local authorities yes i mean we're still getting a 2.5 reduction in public health projects from year on year and year round which is part of the original scheme when we were under budgeted in the first place so it seemed a strange thing to be doing to actually cut public health expenditure particularly in the time of covet okay lloyd do you want to i know vicky's writing in the background lloyd do you want to say anything and then we'll come we'll bring vicky i think i think there's perhaps two points that have been raised one is around the financial impact of the reduction in public health funding and which does fit within the overall financial impact that that would have on the council so that element as sarah said has been picked up and covered within risk seven so if there is a reduction in funding there's a question about how the council responds to that and funds that reduction and but the other part that members have just raised which is in relation to the potential risk and impact on services i think would be covered under um risk for so we've got two parts to risk for now one focus specifically on children's 4a and 4b focusing on other groups which is led by the executive director of adult social care which would incorporate the public health services of the authority at the moment as well so strategic risk 4b would probably pick up the impact on services to vulnerable people and just reviewing the narrative for 4b at the moment it's not clear around it's incorporating public health reductions in services specifically it focuses on being able to maintain service standards to the most vulnerable in society so we can certainly take away an action and work with the risk owner there to put something specific into 4b around public health funding reduction and the potential impact on vulnerable people in warsaw if that if that helps it does to a certain extent but public health is different to social care are we happy that the public health function is sort of being overlooked somewhat here in terms of what the impact of service or financial cuts on public health is as opposed to community uh social care i i i'll open that up council robertson would you like to add anything on that no i certainly would have similar problems i mean it's been happening year in year out the actual cut to public health budgets and uh it hasn't been compensated or recognized and we've got a lot of extra expenditure because of covered of course in combating that problem and we haven't necessarily been reimbursed by central government for all the various extra expenditure okay so could i could i propose um the committee's received the report we understand uh the view of officers to amalgamate former risk nine into risk seven but could i ask and i'll move this for the committee to consider that perhaps the committee expresses its view to the officers and the director concerned that we're we're slightly concerned that the public health function or the impact on public health is being somewhat over looked on this and that we'd ask the director probably in conjunction with the direction of public health to consider whether indeed it does need to be a separate risk or whether they could provide a briefing note to the committee as to the separate items within the public health budget so the risk cause mitigation controls and assurances around that going forward can i put that to community members counselor joelle are you happy with that as a proposal yeah i'll second that yes i'm happy with that yes cancer second thank you counterfeit patrick do you would you agree with us yes agreed cancer robertson agreed yes thank you so nikki you will have captured that for that part of the strategic risk register yes sir thank you can can i just mention something else it's something that council robertson's touched on um we've talked about count uh number seven risk seven increasing and understandably as sarah has touched on but we've also touched on the pro program has been quite an important mitigation not only to risk seven but also to a number of other risks that you look through and yet when we look at risk two risk two is one of our biggest risks and it's actually the delivery of the pro program so i'm quite concerned that we seem to have strategic risks reliant upon the strategic risk there's mitigation so what i'd like to propose is that we we perhaps call the executive lead and deborah vicki will confirm this for me but it's the executive director of resources and transformation to talk about to talk to us and give us more assurance as a committee in terms of how risk two is being addressed which is the proud programme and how it's impacting on the other risks that we're seeing on the risk register which is uh risk number seven which is the the one that's we've seen a large increase on debris yes happy to do that uh chair the executive director responsible for the proud program is me and i'm also obviously responsible for the finances so okay they are integrally uh linked proud program is uh the core way we are delivering our savings in the future because proud program cuts across everything that we do in terms of income generation efficiency ways of working different uh ways of engaging with customers and so on all of that fits together we do have a director responsible for the pride program who would also be available to talk to you about that but happy to uh bring the two together for you at the committee okay thank you are you comfortable with the rationale as to why i've called for that you i'm not trying to treat the officers i am trying to make sure that the committee seeks the assurance it needs to make sure that we're not reliant on something that's going to be an even bigger risk going forward yeah yeah of course okay so nikki do i need to move that forward with the agreement of the committee and do a need a second and moving forward with a vote yes so so um we've got one recommendation that is about the committee um expressing the view that of the concern on the impact on public health being overlooked in relation to former risk nine into seven um and you've asked the director in conjunction with the direct health to reconsider if this needs to be a separate risk or if a briefing now it could be taken back to the committee um we voted on that by welcome that was agreed um and as i understand it there's now a second recommendation um asking the director of resources and transformation to bring to the committee some information on how risk two is being addressed and how it's impacting on other risks in particular with seven um if that's the second recommendation then chair that if that could be voted on or you won't call that exactly correct cancer resolve do you agree with that recommendation yeah i agree with that thank you cancer fitzpatrick agreed thank you cancer jaw agreed and counsellor robertson agreed thank you okay finally can i just mention the new risk the cyber risk that we've we've got on there will that be subject to any specialist audit sarah or does mazars have the specialist knowledge within its resources to be able to deal with that uh yeah we do um we also looked at it in 1920 um we we had an audit an i.t specific audit of cyber security in the 1920 plan which came out with substantial assurance and there were just a few recommendations to be implemented on that one too have been done and two are due to be implemented by march and but along with the whole raft of of um testing and checks that the uh the in-house i.t people do so um it's not due to be looked at in 2021 but it will probably be in the planford for next year okay do we sorry cancer robertson i'm just wondering about the in that particular item the disaster recovery program because now it's one of those things that we fell down down on a few years back that we didn't know we would have to get some some specialist up from bristol or something to bring us back online again so i think looking at the disaster recovery would be very helpful yeah sarah um i can feed that through i'm not quite sure the last time we looked at disaster recovery but if it if it has been quite a while then we'll probably be looking to do that soon anyway so from my understanding if i've read the papers correctly i think the private part of the meeting will be touching on some of the disaster recovery and business continuity plans anyway as former recommendations high level recommendations from previous audience i guess my concern might be given the evident reliance that we're placing on information technology at the moment because of kobe then no doubt postcode given the pro program are we comfortable that we leave such an important audit until 12 months ends sorry is this cyber security this is cyber security and if it's in the 21-22 plan um then we could be doing it as early as as april or may um this year so it doesn't have to be it doesn't have to be 12 months hence um but yeah i lost i double checked before we came in our last report was was um finalized in april so the work was done in february january and february last year anyway so it's um it's just yeah great okay everybody happy with that then thank you thank you sarah thanks very much for that so we now move to item 10 it's it's like the sarah knoll show today it's the internal audit charter so again over to yourself okay um this document sets out our terms of reference for internal audit and and serves as the basis for the governance of the internal audit function so this is really just a formal document which which an audit committee gets to see annually and just sets out the reporting relationship between internal audit and the audit committee and for for this year there are no changes to be consulted on so it's it's just really a formality um so hopefully a quick one okay any members any comments no the one thing being pedantic that i've noticed sarah and i hope you won't mind i i fully understand the need for the uh senior managers and the senior management team to be looking at that and and discussing it with you but uh i would have expected more prominence in terms of the audit committee's role it's my understanding that it's the audit committee's sole role to approve the charter not subject to any senior management decisions or discussions and similarly the resources for internal audit isn't that further terms of reference so i just wanted you to i don't think it's a problem for us to say but if you could have a look at that and clarify for us perhaps send a briefing note around to the committee members as to whether you feel in the light of that you might need to change the the wording sorry was that the plan or the or the child it's the the charter itself charter itself i thought i had said for the audit committee to approve you have in terms of the charter but when you read it itself in your report you've said the audit community approves the charter but when you move through and talk about responsibility there's some reference to other bodies other organs in the council that aren't the audit committee perhaps i wondered if you could just look at that for us yes how would you want to take that forward is that and i'll speak to nikki on this is this something we can approve subject to any minor amendments that sarah might need to make nikki yes if you're happy with that chair and then it can be emailed to you once amended so that the committee can can agree that okay our council members happy with that as a way forward so just again for for nikki's benefits and for the for the benefits of the the meeting cancerous i'd be happy with that as a proposal i i i'll be with that chair cancer fits battery yes i'm happy with that too cancer robert said yes happy thank you and cancer joel i'm happy with that thank you thank you okay we moved to agenda item 11 and this is where sarah can take a rest a well-earned dress and we introduce uh richard percival eriksen auditor and and richard you might want to introduce uh our new colleague andy to the meeting thank you chair just trying to get my camera to work to start with he with you in a second there we are hello everyone yeah uh well actually i'd like to give you two bits of news first uh introduce andy reid to everyone and and he's recently joined us he's a very experienced senior manager i've had the pleasure of working with previously in a number of incarnations he's even been the audit manager on an audit committee that i chair so so i i am very confident that uh he will do a good job for you and you'll enjoy working with him um the the other thing i just wanted to let the committee know is this is actually going to be my last audit committee i've decided to retire but my replacement is john roberts who's some members of the committee may remember from a few years ago when john was the engagement lead for for your audit so john is coming back to something that is familiar with it albeit that you've moved on a bit since since then um john for those of you don't know john john's a a partner in our public sector sector practice so he's one of the if you like the the leaders of our public sector practice and he's looking forward very much to re-engaging with you so i'm very glad that i'm leaving you in very capable hands both with andy and with john so thank you um in terms of the audit letter i just wanted to talk talk you through it and i know we've had a already had a very brief discussion about the audit fee so i'll start on page 94 of the pack which is headed executive summary and really this is just by way of update as to where we've got to members who may recall that as a last audit committee we discussed our audit finders report we were very close to signing off at that point we subsequently signed off following that committee there were no problems uh me issuing an opinion and the opinion was issued on the 27th of november as i signaled at that meeting we included what we call an emphasis of matter paragraph in our opinion and that referred to material uncertainties on property valuation due to covert pandemic and we also disclosed the impact of the pandemic on the pension fund investment properties and those that issue was a direct consequence of the pandemic and as i said at the time when i repeat now it's not a qualification of your opinion these matters are reported in your financial statements we are merely drawn account to them as part of our professional responsibility um whole of government accounts i would like to be able to say it's all done and dusted and in reality it is apart from the fact that there's a systems problem with the system that the national audit officer you are using and we we keep getting frustrated frustrated and poor robert robert pays the account that's working with us is getting increasingly frustrated that every time they run the report there's something else wrong with it so um we are once we have sorted those glitches out i will be able to certify close to the audit i can't do that until um we've completed the whole government accounts work i also need to draw your attention to our other statutory audit powers so i have a range of audit powers statutory recommendations issuing a report in the public interest and just to confirm again there have been no issues during the course of the audit which had led me to consider uh exercising my statutory audit powers so that's just for your reassurance and finally on value for money as as signaled at the previous meeting we issued what we call an unqualified value for money conclusion which is basically saying we're satisfied that the council's got proper arrangements in place to uh ensure economy effectiveness and efficiency and its use of resources i would just remind members as well that this this is the last year that we will issue a value for money conclusion from the coming year we will do an auditor's annual assessment or an auditor's annual report which will include um our views on those arrangements a more detailed piece of work and if we identify what we're now calling significant weaknesses there will be specific recommendations relating to those weaknesses um just on page 95 i just just wanted to flag that again under the working with the council the draft financial stamps were provided to us on time we're very grateful for that clearly it was a bit of a bumpy ride for everybody this year with the impact of covid and as i come on that has had an impact on the fee but i would like to emphasize that the finance team were very supportive and we worked well with them and we're very appreciative of the support that they provide us um i'm not going to go through the detail of the letter but there are just a few points that i would would just like to really remind members of really so i'm moving right forward right onto page 103 um which is a headed audit financial statement significant findings of our issues and it's a table and in the table it talks about going concern now the the auditors uh remit in terms of going concern for the local authorities is is changed now from from november um the guidance has been up updated and there's much stronger presumption that public bodies are going concerns which to be perfectly honest makes an awful lot of sense because it's about the continued continuation of service in the public sector what i would say though is in the commentary we've we've said that the council is closely monitoring the financial impact of covid using the best available data transformation and mitigating actions are being implemented to combat further overspends and there is a strong reserve position and the ability to liquidate cash cash equivalents which is provides a stabilizing effect of the council so it was really just to emphasize that where the finances are now or where they were when we issued the opinion we were comfortable but obviously as an auditor i would always caveat that on the fact that the future is an uncertain place and clearly the future of local government funding and financing is is uncertain um and that really brings me on to the next point i wanted to make which is on page 106 where we talked about the value for money conclusions and we said there towards the bottom of the page and defined as the conclusion uh local authority funding uncertainties and continuing code with financial pressures i mean the council faces significant financial challenge over the next two years although it's good it has a good track record on managing its financial position it's likely the difficult decisions will be need to be made as you go forward now my understanding generally is that the 21-22 budget settlement and with the companion spending review has not been has been better than many anticipated so hopefully that has released some pressure on the council nonetheless the pressure is then i listen with interest on the discussion on the strategic risk register particularly about the importance of the proud program would certainly echo the importance of that transformation program in moving you forward and making sure that the council has a sustainable financial base finally i'd just like to talk about the fee particularly as councillor robertson who has raised that point already so if we if we play this right through from the beginning so so we have a contract with public sector uh audit appointments to deliver your audit and under under the baseline contract there's a escape what we call a scale fee which is just shy of and ten thousand pound you may remember when we issued the plan there was an agreed variation of twenty two thousand pounds and that that really relates to the fact that the audit requirement has changed since the the contract was let so that reflective like the increased pressure there is on on us as your external auditors in terms of the quality and certainly the feedback we've given on the order reflects a much greater scrutiny and challenge and particularly around valuations so so that reflects that we had during the course of the audit we had an issue relating to the accounting treatment of borrowings and loans which we engaged our experts on and we've charged two thousand for two thousand pounds of that because that was um an additional piece of work that needed needed and uh needed to be done the most significant thing is the nearly twenty thousand ninety thousand eight hundred that we've we've included a fee variation that relates to the impact of covid and as i say although we're grateful for the support both in terms of additional time due to remote working but also in terms of the additional work because of the volatility evaluations we put a significant amount of additional time into that which is planned and that's really what that reflects so at that point chair i was going to pause and i'm quite happy to take any questions that members might have thank you richard that's a very comprehensive report and it picks up on the the report that he gave the committee in november doesn't it so that that's very helpful any council robertson i know it was the question that you raised earlier about the fees are you you're happy with the explanation provided there yes that's fine i just may ask about the issue of valuations you you raise the issue it's incredibly difficult to make valuations and we're also you know looking at a considerable deficit to balance the books by the end of february from the budget point of view at 10 11 pound 11 million or so we're still shy of of actually balancing the books do you think that we have enough reserves you know in view of that particular risk under things like valuations i mean have you actually included things like the valuation of the sadler center in that figure yeah if i could make a distinction if that's okay um chair in terms of in terms of valuations as auditors we get very excited about valuations and spend a lot of time interrogating those valuations and and the real the reason for that is twofold firstly it's a highly material figure on the balance sheet and and secondly our regulators because it's a big estimate effectively and the audit requirements around estimates are very keen that we scrutinize that so in terms of the issue about for example the saddler center yes when we look to the valuations we would have we will have considered the valuers view at that time on those valuations and the fact that the valuer caveated his valuation on this material uncertainty ground reflected that uncertainty there but that is separate from the issue about reserves and the ability because however excited we get about valuations they don't actually affect the the general fund reserve position of the authority so um from from our reading of the accounts and our understanding of the financial um position that the authority is in we're comfortable that in the short term there are sufficient reserves to buffer any blow but what i would say is what i always say is once you spend your reserves they're gone and you you all that your all that use of reserves particularly unplanned reuse of reserves will buy you is time they will not it will it's not a solution to a problem itself okay thank you richard council robertson are you happy with the response you had there yes thank you very much very good thank you cancer fitzpatrick and you're on you're on mute by the way that's it great thank you and i just wanted to ask about uh we'll go back to the um the whole government accounts issue because that was one of the mentions in the tracking chart earlier on and i know it had a target date of something like the 23rd of feb um you know it is still now up down to that because i realize it is a national issue isn't it richard can i just jump in first you're quite right cancer fitzpatrick and what the audit committee uh subsequently asked was that that be brought to a meeting on the 23rd of february we've since had an update from our external auditors and as you can provide a little bit more information that it's still not resolved but we do want this resolved before the end of the financial year i.e by the end of 31st of march so we are asking that that be brought to a special meeting of the committee on the 23rd of march now richard do you want to add to that yeah i think i think again there's two things distinguished the we can't carry on whole look of our whole government account responsibilities until basically we get to the point where i can issue an opinion on the accounts because the starting point is a set of set of final financial statements um that in normal circumstances that takes a few days to sort out the issue we've had this year is that the the process has been run on a new piece of software and you're by far away not the only authority where we can't execute the process because of a defect in the software it it it has no impact on the audit other than i can't issue my uh my my final closure certificate i think probably what's more important particularly from andy's point of view will be that what we need to get into now is planning for next year's audit um and we we we don't have sufficient time because we're you know as things have slipped because of the impact of kobe to complete our planning work before the february meeting so that's been pushed back into march but as as soon as we've got the whole government accounts issue cleared i'll make sure that the the chair and members are notified that we're clear and i've issued my certificate thank you and hope hopefully it will be in sort of days rather than weeks that we get there future patrick are you comfortable with that response yes thank you very much thank you richard thank you that's a very comprehensive report um can i firstly again welcome andy i'm sure you're going to have some great times with the the team and i know certainly from my involvement with with warsaw council um it's successively the case that the finance team are very highly regarded so i think you you joined in a good uh a set up there and so welcome to them we welcome john roberts and richard on behalf of the the audit committee and the council just to thank you so much for your input and valuable guidance that you provided the committee over the time it's uh we wish you all the very best for a long happy healthy retirement thank you very much yeah i appreciate that thank you okay so we we now move to the to the private session of the meeting and i'll ask nikki can you confirm that we can move [Music] when [Music] you