Agenda and minutes

Audit & Governance Committee - Monday, 18th March, 2024 6.30 pm

Public access to this meeting is available via between the hours of 6.15pm – 6.30pm via the main door of the Municipal Buildings on West Street, Boston

Venue: Committee Room - Municipal Buildings, West Street, Boston, PE21 8QR. View directions

Contact: Pippa Rose, Democratic Services Officer  01205 314228 email:  pippa.rose@boston.gov.uk

Media

Items
No. Item

50.

Apologies

To receive apologies for absence.

Minutes:

Apologies for absence were received from Councillor Patricia Marson.

 

51.

Minutes pdf icon PDF 141 KB

To sign and confirm the minutes of the last meeting held 29January 2024.

Minutes:

The Minutes of the previous meeting held 29th January 2024 were agreed and signed by the Chairman.

 

52.

Declaration of Interests

To receive declarations of interests in respect of any item on the agenda.

Minutes:

Councillor Paul Gleeson declared that he was a Board Member of Public Sector Partnership Services Ltd (PSPSL).

 

Jo Brigham advised that she had recently applied for a Non-Executive role at PSPSL.

 

53.

Public Questions

To answer any written questions received from members of the public no later than 5 p.m. two clear working days prior to the meeting – for this meeting the deadline is 5 p.m. on Wednesday 13th March 2024.

Minutes:

There were none.

 

54.

Internal Audit Progress Report pdf icon PDF 486 KB

(A report by Matthew Waller, Internal Audit Manager – Lincolnshire County Council)

Additional documents:

Minutes:

The Internal Audit Manager presented the Internal Audit Progress report, which detailed progress with Internal Audit work as at March 2024.

 

The Internal Audit Manager updated Members on the following areas:

 

·         The status of live internal audit reports;

·         An update on progress against the internal audit plan;

·         A summary of internal audit performance, planning and resourcing issues; and

·         A summary of significant issues that impact of the Head of Internal Audits annual opinion.

 

Members noted that all the work was currently underway and nearing completion; and that the last few audits would be finalised by the end of March.

 

Attention was drawn to the report section ‘Update on Internal Audit Activity’ which provided information regarding the one No Assurance review, the one Limited Assurance Review, and a further five completed reviews which had been done since the last report. Information was also provided on the management actions in respect of audits that had been implemented following recommendations received. There was only one high outstanding action and seven medium actions, fully detailed within the report, which was a very good position to be in.

 

Members noted the analysis of the audit reviews, in particular noting the Strategic Risk Register Review, Building Control, Housing Benefit Follow Up; and the Fraud Risk Register Development which would be made part of regular risk management reporting in order to strengthen the process.

 

The Internal Audit Manager also drew attention to the Annual Plan and its current position. Details of the outstanding actions were documented within Appendices 1 and 2.

 

Jo Brigham welcomed the update and stated that it would be helpful to have details of any new date for delivery. She also advised that it would be helpful to understand the risks and actions in the interim. In respect of the Housing Benefit audit, she asked if the manual quality assurance process was being addressed in order to bring it in line with the other Partnership Authorities.

 

The Chief Executive – PSPSL advised that there was still a manual process in place and that it would be necessary to align the Revenues and Benefits System with the other Councils in order to address the issue, which would be done as part of a transformation plan. In respect of timescales and process, he advised that it would span a 3 year business plan period. If the transformation plan was agreed by all Councils there was still a sizable piece of work to be done. He reassured members that the manual process would continue to be sufficient in the interim.

 

Councillor James Cantwell referred to the Work Programme and queried why the ICT High Risk Review was listed as ‘Not Applicable’ in the Final Report column. The Internal Audit Manager advised that N/A had been written in error instead of a tick.

 

P-Card

 

The Internal Audit Manager reported on the P-Card audit work which had been carried out.

 

The Chairman advised that he had invited Officers (P-Card users) to attend the meeting in order to emphasise the  ...  view the full minutes text for item 54.

55.

Internal Audit Plan pdf icon PDF 297 KB

(A report by Matthew Waller, Internal Audit Manager – Lincolnshire County Council)

Minutes:

The Internal Audit Manager presented the latest Internal Audit Progress Plan 2024/2025. He advised that the plan was linked to the strategic risks and corporate plan priorities and that it would enable him to give a robust opinion at the end of the year. Members noted the flexibility of the plan in cases of high risk issues.

 

The Internal Audit Manager highlighted the following areas:

 

·       Performance Management;

·       PSPS SLA’s and Performance Management;

·       Finance Budget Monitoring;

·       Transformation Consultancy;

·       Finance Control Testing;

·       Depots and Waste Services; and

·       Capital Programme / Towns Fund.

 

Councillor James Cantwell stated his assurance of seeing Depots and Waste Services, and ICT within the plan. He queried the reasoning behind ‘technology infrastructure failure’ and ‘coverage to be announced’. The Internal Audit Manager advised that ‘technology infrastructure failure’ was a strategic risk description and that later in the year they would be looking at the risks around ICT and then agreeing the areas to cover.

 

Councillor Mike Gilbert referred to the Capital Programme / Towns Fund and queried how they evaluated the success. The Internal Audit Manager advised that they looked at the governance and controls in the way the Capital Programme / Towns Fund was being managed. The Deputy Chief Executive – Corporate Development and Section 151 Officer referred to various aspects, one being ‘on budget on time’ which was very difficult in the current contract inflation environment. She added that in terms of outputs and outcomes, when the funding was awarded they were given very specific targets which were built into the monitoring; and in respect of processes the Internal Auditors would be looking at where they were with it.

 

Jo Brigham stated that she expected benefit realisation to be part of the governance. She referred to the PSPSL SLA’s and Performance Management and queried whether it would include looking at the arrangements for the Council as a customer and also from the owners’ perspective. The Internal Audit Manager advised that they would agree a terms of reference with management and pick up the key areas (risks, process and governance) on that. Jo Brigham queried whether it would highlight where responsibilities had transferred and where the risks were. The Internal Audit Manager clarified that it would. 

 

RESOLVED:

 

That the content of the plan be noted.

 

56.

Risk Management Report pdf icon PDF 208 KB

(A report of John Medler, Assistant Director – Governance & Monitoring Officer)

Additional documents:

Minutes:

The Group Manager – Insights and Transformation presented a report by the Assistant Director – Governance which provided the Committee with an update on Risk Management as at the end of December 2023.

 

The Group Manager – Insights and Transformation highlighted the risk scores, changes in Quarter 3 and direction of travel in section 2.2 within the report. She advised that there was one new risk in relation to the net zero target.

 

The Group Manager – Insights and Transformation mentioned the risk workshops that were being held at the end of March 2024. She added that work had been done with the Assistant Directors to review of all their strategic partnerships and fraud risk for Quarter 4 reporting. Members noted that the fraud work that Internal Audit had done would feed into the workshops, the results of which would be reported to the next meeting. The feedback from the Committee meeting in respect of P-Cards, governance, ethics and manual processes would also be fed into the workshops. It was also suggested that inherent risks be added to the risk register, which was currently being considered.

 

Jo Brigham thanked the Group Manager – Insights and Transformation for the new format of the risk register and welcomed the work planned. She added that the benefit of ‘inherent’ was that it gave confidence that the mitigating factors were working.

 

Councillor James Cantwell queried whether high or critical operational risks could be included within the table to make the Committee aware. The Group Manager – Insights and Transformation advised that it was being picked up in the Quarter 4 reporting.

 

Councillor Mike Gilbert referred to the local business and bank closures in the town. He queried whether something around this in respect of local economy could be added in. The Group Manager – Insights and Transformation advised that she would address the matter with the relevant Assistant Director.

 

Councillor Dani queried whether the market should actually be a high risk. The Group Manager – Insights and Transformation advised that she had picked this up with the lead and had included more details. She added that she would pick it up again at the next workshop. Councillor Dani requested details of the exact numbers of stalls in the market on a Wednesday and Saturday in order to give a clearer picture. 

 

RESOLVED:

 

That the report be noted.

 

[The Group Manager – Insights and Transformation left the meeting at 8.03 p.m., following consideration of the above item.]

 

57.

Q3 Treasury Management Update 2023/24 pdf icon PDF 225 KB

(A report of Christine Marshall, Deputy Chief Executive – Corporate Development & Section 151 Officer)

Additional documents:

Minutes:

The Interim Treasury & Investments Manager PSPSL presented a report by the Deputy Chief Executive – Corporate Development and Section 151 Officer which contained the Quarter 3 Treasury Management update on the Council’s “Treasury Management Strategy Statement and Annual Investment Strategy” as at 31st December 2023.

 

The Appendix covered the following areas;

 

·         An economic update for the 2023/24 financial year;

·         The interest rate forecasts;

·         A review of the Treasury Management Strategy Statement and Annual Investment Strategy;

·         A review of the Council’s investment performance for 2023/24;

·         A review of the Council’s borrowing strategy for 2023/24;

·         Debt rescheduling;

·         Summary of the net position against the budget and forecast outturn; and

·         Compliance with Treasury and Prudential indicators.

 

Members thanked the Interim Treasury & Investments Manager PSPSL for a very concise and clear report.

 

Jo Brigham referred to the Payroll Reconciliation and queried whether the following areas could be included within the risk report: the slippage in the capital programme; and the risks highlighted in the audit report. The Deputy Chief Executive – Corporate Development and Section 151 Officer advised that slippage was not unusual in projects of that size and scale. She added that they were well within the timelines for delivery of those projects. The Deputy Chief Executive – Corporate Development and Section 151 Officer stated that detailed updates were provided in the quarterly report to the Cabinet that was managing the Capital Programme. She agreed to feed the information back to The Group Manager – Insights and Transformation.

 

RESOLVED:

 

That the report be received and noted.

 

[The Interim Treasury & Investments Manager PSPSL left the meeting at 8.17 p.m., following consideration of the above item.]

 

58.

2022/23 Audit Completion Report pdf icon PDF 5 MB

(A report by Mazars, External Auditors)

Minutes:

The Audit and Assurance (Public & Social Sector) Manager, Mazars presented the Audit Completion report which provided a summary of audit conclusions. The report outlined that the Audit was substantially complete, with only a small number of areas still outstanding that were actively being worked on regarding performance management.

 

The following areas were covered within the report;

 

·         Status of the audit;

·         Audit approach;

·         Significant findings;

·         Internal control recommendations;

·         Summary of misstatements; and

·         Value for money.

 

The Chairman queried why it had taken eleven months to get a bank reconciliation. The Chief Finance Officer (PSPS) agreed to investigate and report back. She gave assurance that measures had been taken to bring everything up to date and proactive action would be taken on a monthly basis going forward.

 

The Chairman queried what the non significant items were. The Chief Finance Officer (PSPS) clarified that one was in relation to the pensions liability. The Audit and Assurance (Public & Social Sector) Manager, Mazars referred to the timing difference which would be reversed out next year. Members noted that the pensions were managed by Lincolnshire County Council. The Chief Finance Officer (PSPS) advised that the other item was in respect of a lease for a rental property.

 

Members thanked the Auditors for their work. 

 

RESOLVED:

 

That the report be noted.

 

59.

Approval of Financial Statements 2022/23 pdf icon PDF 227 KB

(A report of Christine Marshall, Deputy Chief Executive – Corporate Development & Section 151 Officer)

Additional documents:

Minutes:

The Chief Finance Officer (PSPS) presented a report by the Deputy Chief Executive – Corporate Development and Section 151 Officer which provided an update on the progress for publishing the Financial Statements 2022/23.

 

The unaudited 2022/23 Financial Statements had been approved by the Audit and Governance Committee on 13th July 2023 with delegated authority having been given to the S151 Officer, in consultation with the Chairman of the Committee, to approve any required amendments after the Committee date and prior to the official signing of the accounts. The statutory deadline for approval of the Financial Statements was 30th September 2023.

 

The recommendations were moved by Councillor Paul Gleeson and seconded by Councillor Anton Dani.

 

RESOLVED:

 

1.     That the Financial Statements 2022/23 (Appendix A) be approved;

 

2.     That the Annual Governance Statement 2022/23 be approved; and

 

3.     That the S151 Officer be authorised, in consultation with the chairman of the Committee, to approve any required amendments following the Committee meeting and prior to the official signing of the Financial Statements.

 

60.

Financial Statement - Accounting Policies 2023/24 pdf icon PDF 197 KB

(A report of Christine Marshall, Deputy Chief Executive – Corporate Development & Section 151 Officer

Additional documents:

Minutes:

The Senior Finance Business Partner presented a report by the Deputy Chief Executive – Corporate Development and Section 151 Officer on the Accounting Policies for inclusion in the Financial Statements 2023/24. The Financial Statements 2023-24 - Accounting Policies were attached as Appendix A to the report.

 

Members noted that the Financial Statements summarised the Council’s transactions for the 2023/24 financial year and its position as at 31st March 2024. The Council was required to prepare an annual Statement of

Accounts by the Accounts and Audit Regulations 2015, which required the accounts to be prepared in accordance with proper accounting practices. Those practices primarily comprised the Code of Practice on Local Authority Accounting in the United Kingdom 2023/24, supported by International Financial Reporting Standards (IFRS).

 

The Senior Finance Business Partner drew attention to the key principles:

 

·         Accruals of income and expenditure; and

·         Interest in Companies and Other Entities.

 

The recommendations were moved by Councillor Paul Gleeson and seconded by Councillor Anton Dani.

 

RESOLVED:

 

That the Accounting Policies for 2023/24, at Appendix A within the report, be agreed.

 

61.

Work Programme pdf icon PDF 130 KB

(For Members to consider the Committee’s work programme.)

Minutes:

The Assistant Director - Governance and Monitoring Officer presented the annual Audit and Governance Work Programme 2023/24.

 

Members noted that this was the last scheduled meeting for the municipal year and that the 2024/25 dates were awaiting final approval after which they would be circulated.

 

The Chairman announced that the Self Assessment training, which had previously been scheduled to follow the meeting, had been moved to Monday 8th April 2024 at 6.30 p.m. He requested that members bring their devices with them.

 

Councillor David Middleton referred to a previous meeting where a large settlement figure had been discussed in relation to the departing Chief Executive at that time. He queried the number, and also the reasons and risks around it. The Deputy Chief Executive – Corporate Development and Section 151 Officer advised that she was still looking into the issue and that she would circulate the previous reports that had been circulated to Full Council as part of that.

 

RESOLVED:

 

That the work programme be noted.

 

The Chairman thanked everyone that had attended the meeting. He also thanked the Audit and Assurance (Public & Social Sector) Manager, Mazars who had attended their last meeting.