To receive apologies for absence.

Apologies were received from Cllr Frankie Evans and Marie Rosenthal, Solicitor to the Council.

To confirm the minutes of the meeting held on 21 June 2012 (attached).

Cllr Birch, chairman of the Audit Committee, asked if there had been progress on the work of the treasury adviser selection panel (agenda page 6, resolution)

Cllr Robinson recognised that there was a clash of meetings on the proposed date of 10 October 2012 at 5pm in Cheltenham.

Cllr Birch then asked if there had been any progress on the county’s authorities pooling risks relating to the change in business rates (agenda page 7).

The Group Manager for Finance and Property replied that the matter was in hand. Cllr Robinson, Cabinet Member for an Efficient Council, added that the matter would need to go to Full Council when ready.

The minutes of the meeting held on 21 June 2012 were then confirmed and signed as an accurate record.

The chairman to identify any items of urgent business.

The chairman identified no items of urgent business on this occasion.

To receive any declarations of interest in any matter to be discussed at the meeting.  Members and officers are requested to identify the nature of the interest.

No declarations of interest were made.

The chairman to sign the staff and member gifts and hospitality registers and the fraud and corruption register.

Cllr Birch, chairman of the committee, confirmed that he had inspected and signed the gifts and hospitality registers and the fraud register.

Peter Barber to present the report.

Peter Barber, Audit Commission, presented the report, emphasising that there were no material errors in the financial statements and only a few minor errors, which had been corrected. He said that the report contained very positive messages and he intended to issue an unqualified opinion on the financial statements for 2011/12 and an unqualified conclusion regarding value for money.

Cllr Birch thanked Peter Barber for his comments.

The Finance Manager confirmed for Cllr Bill Evans that the errors in payment to councillors had been corrected.

The Group Manager for Finance and Property and Head of Paid Service said that they would be happy to give the detail to Cllr Bill Evans regarding the exceptional item of £200,000 mentioned on agenda page 17, but that the item had been dealt with as exempt business by the cabinet.

Peter Barber continued to present the report, commenting that neither identified risk on agenda page 14 had materialised during 2011/12. On agenda page 15 he had made a recommendation that the council undertake periodic reconciliation of the council's property record to the legal deeds.

He reminded members that two years ago the value for money conclusion focus had changed to one of resilience, in recognition of prevailing economic circumstances. He commented that it had been impressive of the council to deliver its budget to within £15,000 against that background. The council had shown a robust budget setting process and was trying to generate savings and income to maintain services within the budget available and with reasonable reserves in place. He was satisfied that the council was operating value for money services and its savings plan was realistic and achievable. He therefore intended to issue an unqualified, clear opinion.

Cllr Birch asked if it was a good thing that the council spent less on environmental services.

Peter Barber replied that the comparisons were across various services and the below average spend was satisfactory as long as the organisation was satisfied with the service it offered.

Cllr Evans asked how the Audit Commission's fees were broken down and asked for the number of hours spent working on the council's audit.

Peter Barber replied that the fee included the Commission's work in planning, controlling, processing, communicating and reporting its audit. The fee was set centrally by the Commission, but had been higher compared to other comparable councils because of necessary additional work done in previous years. He had negotiated a further £5000 reduction with the Commission, based upon the council's recent progress. He added that he did not have a figure for the number of hours spent on the audit.

The committee noted the report.

Kevin Henderson, Audit Commission, to present the report for consideration.

Kevin Henderson, Audit Commission, presented the report. He said that the work regarding NNDR and housing benefit (agenda page 35) was not quite finished and would be picked up in the following week. However he would probably be sending the annual audit letter in early October - earlier than stated. He explained that the letter would be shorter than previously, as it would only address issues identified between the end of the audit period and the date of the letter. He finished by inviting comments on the key considerations raised on agenda page 40.

The Group Manager for Finance and Property replied that the council had established a timetable regarding NFI data, was relying on feedback from the Commission regarding its actions on claims and returns, had responded to the draft Local Audit Bill and SWAP had put together a joint response to the consultation on internal audit standards.

Peter Barber confirmed that from 1 November 2012 Audit Commission staff would TUPE to Grant Thornton, which had become the external auditor for the council for 2012/13 from 1 September. He tabled a briefing note that explained the situation.

Ian Baker, SWAP, to present report F.176 for consideration.

The SWAP Audit Manager presented report F.176, commenting that none of the three audits completed to date had reported significant findings or high-level risks. She highlighted the substantial assurance given to Democratic Services and reported that the management had addressed issues arising from the cemetery and crematorium audit. SWAP had discussed the matter of key control audits with the Cotswold Audit Partnership relating to the GO Shared Service to avoid repeating work. However she would report all matters relevant to the council to the Audit Committee. She was optimistic that the two audits in progress would be completed by the end of October. Two ICT reviews would begin in early October.

The committee noted the report.

The Group Manager for Finance and Property to present report F.174.

The Finance Manager presented report F.174, commenting that it had been a great achievement by the council’s managers to keep within £15,000 of the budget, considering the amount of change over the previous year. It showed that in-year budget monitoring was beginning to pay off. She then highlighted items from the following pages of the report.

Agenda page 81 - A new format had been introduced the previous year, which she did not see as particularly helpful for managers or non-accountants to understand.

Agenda page 82 - The £4.2 million loss was explained by increased pension liability, as assessed by the actuary.

Agenda page 83 - The table relating to reserves had also been introduced for the previous year was, having been altered at the request of the Audit Commission to include sub-totals for ease of cross-referencing. She said that it showed the complexity of accounting in local government.

Agenda page 114 - She emphasised that the £248,460 for employee exit packages included money the council had to pay into the local government pension scheme to cover early retirement costs.

Agenda page 117 - The table in paragraph 24 clearly showed the reduction in external audit fees.

Agenda page 139 - The table showed the actuary's assumptions regarding increased the pension liability of £2.57 million due to predicted reductions in return on assets.

The Finance Manager confirmed that there would be no impact on the council's liabilities as a result of the GO Shared Service TUPE transfers.

The Group Manager for Finance and Property thanked the Finance Manager for preparing the document, delivering the training sessions and her work on accounts. He informed the committee that she would be leaving the council next year as a result of the GO Shared Service restructure.

Cllr Birch added the thanks of the committee for her support.

RESOLVED -  

a)      To formally approve the accounts for the year ended 31 March 2012.

b)     The Chair of the Audit Committee to sign the Statement of Accounts and the letter of representation.

The Head of Paid Service to present report SD.99, regarding the statement and the action plan for consideration and recommendation.

The Head of Paid Service presented report SD.99, explaining that the committee had already noted the statement at its May meeting, but was now required to formally recommend it for adoption. The only change from the previous version was the inclusion on agenda page 166 of the reference to the SWAP Group Audit Manager's annual review statement, at the suggestion of the Audit Commission, which represented a further level of assurance. She finished by referring to the action plan at annex B to the report and asked the committee to recommend that she and the Leader of the Council sign the statement.

RESOLVED - to formally recommend the annual governance statement for 2011/12 for adoption and signature.

The Group Manager for Finance and Property to present report F.170 for consideration.

The Finance Manager presented report F.170, explaining that the GO Shared Service partners agreed that they needed to harmonise their contract procedure rules, which had already been agreed, and their financial procedure rules, which had been worked on to reflect best practice across the partnership.

She said that the tabled version had been considered by the Constitution Working Group and contained comments to show sections that were specific to this council. She also highlighted annex B of the report, which listed the proposed changes from the current rules, which largely strengthened arrangements.

Cllr Bill Evans, a member of the Constitution Working Group, commented that the tighter controls were very welcome and he viewed the new document as an improvement.

The committee noted the report.

The Group Manager for Finance and Property to present report F.169 for consideration.

The Group Manager for Finance and Property presented report F.169, commenting that the pension liability might become greater and that the timing of precept payments could affect the figures. He ran through the report commenting on the following points.

Agenda page 261, paragraph 4.1 - The council had for a very short time at the end of August breached the prudential indicator limit.

Agenda page 262, paragraph 5.7 - There was a slight downturn in the predicted interest rates, which would have a small impact.

Agenda page 265, paragraph 4 - The indicators operated on an annual basis, so he was unsure of their value mid-year.

Agenda page 269, paragraph 19 - The table dealt with lease arrangements that counted as borrowing, so there should not be much variance.

RESOLVED - To note report F.169 and recommend to the Cabinet for approval

The Group Manager for Finance and Property to present report F.177 for consideration.

The Group Manager for Finance and Property presented report F.177, stating that the lone working policy was on track for completion by its revised deadline and highlighting the new level four recommendations. SWAP 081, dealt with how the Civica system handled suspensions and were in hand. For SWAP082, The risk management framework would be presented to the Audit Committee and the recommendation for operational risk registers represented a good double check.

The committee noted the report.

The Risk, Insurance and Procurement Officer to present report F.173 for consideration

The Risk, Insurance and Procurement Officer presented report F.173 emphasising that it was an important part of the council's work on combating fraud and corruption. SWAP had developed the policy as a generic document for adaptation by member councils. It would only be effective if properly publicised. To that end the council would distribute the leaflet to staff, members and key contractors.

RESOLVED - to approve the revised whistleblowing policy and leaflet.

The Risk, Insurance and Procurement Officer to present report F.172 for consideration.

The Risk, Insurance and Procurement Officer presented report F.172, commenting that the council already had robust processes and needed to have a plan to address any matters arising. The new plan had been adapted from a generic SWAP document and included flowcharts detailing actions when any irregularity or suspicion arose.

Cllr Birch was aware that SWAP was looking at the matter across the partnership. He asked if the plan was not a little long-winded.

The Group Manager for Finance and Property replied that the flow charts in particular would be useful alongside the whistleblower policy, for staff to know what would happen and what the expectations were for managers.

Cllr Hogan suggested an amendment to the flowcharts to change any instance of the phrase 'hand over the notes that you have collected' to 'hand over a copy of the notes that you have collected'. He said that this was the advice he had always given. The committee agreed the amendment.

RESOLVED - to approve the updated Fraud Response Plan, with the amendment to change any instance of the phrase 'hand over the notes that you have collected' to 'hand over a copy of the notes that you have collected'.

The Risk, Insurance and Procurement Officer to present report F.175 for consideration.

The Risk, Insurance and Procurement Officer presented report F.175. He said that the new structure for the GO Shared Service would be in place from 5 October and savings should start from that date. He highlighted SR-4.01, commenting that the cabinet had agreed for the council to join the county's joint waste committee in April 2013, which represented an opportunity to make savings from future work together.

Cllr Birch commented that the risks did not always include a start date. He also mentioned that SR-3.01, relating to leisure provision was not due until 2014.

The Head of Paid Service explained that this was a long project, and progress reports would be presented to the cabinet throughout its time. The first of these was on the agenda for the Cabinet's meeting on 4 October 2012.

The committee noted the report.

All meetings at 5.30pm with a training session at 4.30pm (unless otherwise stated)

Thursday 24 January 2013

All meetings at 5.30pm with a training session at 4.30pm (unless otherwise stated)

Thursday 24 January 2013