To receive apologies for absence.

Apologies were received from Cllr Connell, who was replaced as a member of the committee by Cllr Lawton, Kevin Henderson and Peter Barber, Audit Commission and Ian Baker, SWAP Group Audit Manager.

To confirm the minutes of the meeting held on 17 May 2012.

The minutes of the meeting held on 17 May 2012 were confirmed and signed as an accurate record.

The Group Manager for Finance and Property confirmed that he would forward the answer to George Healey's question regarding automatic write-off in Agresso.

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 and indicate whether it is personal or prejudicial.

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.

The Group Manager for Finance and Property to give an oral update on behalf of the Audit Commission.

The Group Manager for Finance and Property explained that nothing had changed since the previous committee meeting in May, but that Audit Commission staff members were currently working with the council's Housing Benefits team. He added that it had now been confirmed that Grant Thornton would be the external auditor for all the GO partner councils, to achieve possible further savings and avoid duplication.

The Group Manager for Finance and Property to present report F.166 for consideration.

The Group Manager for Finance and Property presented report F.166, highlighting SWAP063 regarding vehicle insurance, stating that the Personal Development Appraisal process was picking it up.

George Healey asked what the risk was of drivers being uninsured, given that the original deadline had been December 2011.

The Group Manager for Finance and Property replied that the deadline had been moved to July so that the issue could be dealt with in employees' PDAs. In any case drivers had to self-certify insurance cover when making a mileage claim, so the new action was a double check.

The Group Manager for Finance and Property explained that when actions had been 100 per cent completed, they were not included in the report, unless they were new recommendations that had been made between Audit Committee meetings, such as SWAP070 and SWAP073 on agenda pages 4 and 5.

The committee noted the report.

Ian Baker, SWAP, to present report F.165 for consideration.

The Audit Manager presented report F.165 explaining that pages 11 to 17 gave a summary of work undertaken, including changes made and agreed with the Section 151 Officer.

Referring to agenda page 15 she said that the main accounting opinion had been changed to reasonable, because a system error had been fixed. She was pleased to report that managing with reduced resources (agenda page 17) had been given comprehensive assurance.

She explained that themed audits (agenda page 18) had taken place across the SWAP partners. The council had taken part in all but two and would receive the reports for all, to enable the sharing of good practice and identification of common control weaknesses.

She highlighted the fact that the council had been the first of the GO partners to implement the Agresso Business World (ABW) system, so had been unable to draw on others' experience. Staff had been working hard to ensure that routines were developed.

She reported that four audits had been dropped to meet SWAP board requirement to reduce by 5 per cent and to balance work undertaken during the implementation of Agresso.

Agenda pages 20 to 21 covered the SWAP Group Audit Manager's consideration of work, assurance and outcomes. He gave reasonable assurance to the council's work covered by internal audit for 2011/12. He believed that the Corporate Governance Group had addressed and would monitor the one significant corporate risk identified around contract management.

The Audit Manager clarified for George Healey that non-opinion referred to work undertaken generally at the request of the council that would add value to the process and share how partners were working, without the need for a level of assurance.

Cllr Bill Evans asked how auditors quantified 'adding value'.

The Audit Manager answered that added value could not be quantified in monetary terms, but that councils could learn from control weaknesses and from what other councils did to strengthen them.

She also confirmed for Cllr Hogan that in future SWAP reports would always use the word 'Gloucestershire' when referring to the county.

The committee noted the report.

The Head of Paid Service to present report F.164 for consideration.

The Risk, Insurance and Procurement Officer presented report F.164, reminding members that the committee had seen the Annual Governance Statement at its May meeting. The six areas identified for improvement now appeared as actions for the Corporate Governance Group and the Audit Committee to monitor throughout 2012/13.

Cllr Birch asked if the GO Shared Service (GOSS) had an input to the action plan and how internal audit would work with Grant Thornton, the external auditor.

The Group Manager for Finance and Property agreed with Paul Jones, GO Shared Service Head of Finance, that annual governance statements and actions were a matter for individual councils. GOSS only appeared as an item on the plan, because it was a new venture involving change that required monitoring. He informed the committee that he was the council’s client officer for GOSS and sat on a GOSS Client Officers’ Group and that Cllr Robinson and the Head of Paid Service also represented the council on a higher-level Joint Monitoring and Liaison Group.

The Audit Manager added that SWAP and the Cotswold Audit Partnership were in discussion to ensure that no GOSS audit areas were duplicated. The Group Manager for Finance and Property explained that an advantage of all partners having the same external auditor was that they only had one view to satisfy.

Cllr Bill Evans recognised that partnership working was hard and noted the recent positive article in a national newspaper regarding GOSS. He asked why the partnership had taken two years to establish.

The GOSS Head of Finance replied that the decision to implement the ERP system across the partnership before establishing the Shared Service had been why the project had taken two years.  He noted that the council had already completed a document on lessons learnt from the ERP (Agresso) implementation and that the other partners would do the same in due course. He believed that, had more resources been available, the GO partnership could have concentrated its efforts on the first council to implement the system with a view to replicating that process with the other partners. He added that to have used other enterprise resource planning systems rather than Agresso would have cost more to implement. The creation of Ubico had come at a bad time for GOSS, but the system suited the company. He gave credit to the council's staff for meeting the challenge of going first.

The committee noted the report.

The Finance Manager to present report F.162 for consideration.

The Group Manager for Finance and Property presented report F.162 in the absence of the Finance Manager, commenting that it built on the strategy set in February 2011. He reported that the council had financed social housing using less capital than projected. Another bonus had come later in the year with the unanticipated £730,639 from the Homes and Communities Agency (HCA). He reminded members that the council did not borrow money, but that leasing obligations appeared under that category on p35, paragraph 3.1. Referring to the table on page 37, paragraph 5.5, he explained that the council had breached the upper limit of £2 million overdraft for one day due to the account not having enough to cover a precept.

He reminded the committee that the council's policy was to secure safe returns over high interest. The council's external cash managers, CDCM, had achieved above average returns, but were given no leeway by the council, which controlled how the money was invested.

He informed members that the end date for the money invested with RBS was 2013, not 2012 (agenda page 47). He then referred back to page 42, paragraph 8.6.5, explaining that theoretically investments over longer time periods represented greater risks.

Answering a question from Cllr Birch he said that the council's treasury advisers had offered to lead a training session for members and would be able to explain the effect of risks arising from bank takeovers.

The Group Manager for Finance and Property then asked to amend the recommendations in the report, explaining that as part of the GO shared service, councils wished to save money by looking at the possibility of using the same treasury adviser. The GOSS partners together with the other districts in the county and the county council had approached three treasury advice companies, who would be giving presentations on 8 and 9 October 2012. Each council would have two elected members on a panel to evaluate those presentations

The additional recommendation would read as follows

c) To appoint the chairman and vice chairman of the Audit Committee to the treasury adviser selection panel for the GO Shared Service and Gloucestershire County Council shared treasury adviser

Cllr Hogan believed that the move might be a good opportunity to drive a better deal and asked whether currently treasury advice fees were fixed or incentive-based.

The Group Manager for Finance and Property said that while individual fees were around £8,000 per year, when added together they amounted to a sizeable amount across the districts and county council.

Cllr Bill Evans asked if the proposed process might lead to the same advisers being chosen, who had advised Cheltenham to invest in Icelandic banks.

The GOSS Head of Finance replied that Cheltenham Borough Council had changed to Arlingclose because it had been the only adviser not giving that advice.  The Forest of Dean District Council's Section 151 Officer had ignored the advice of its adviser in not investing with Icelandic Banks. He then explained that the proposal to  ...  view the full minutes text for item 10.

To consider the current register as at report F.163.

The Risk, Insurance and Procurement Officer presented report F.163, commenting that this was a regular monitoring item for the register. He said that there had only been minor changes since the previous committee meeting. Risk SR101 regarding the Single Status exercise had completed final pay modelling and a report would be presented to the cabinet in October after the trade unions had consulted over the summer. The Head of Paid Service added that the target date for that risk should read 'no earlier than January 2013' rather than 2012.The cabinet had also considered risk SR401 regarding diversion of waste from landfill.

Cllr Birch asked what was meant by the term 'financial specialist support' for risk SR104 on agenda page 53.

The Group Manager for Finance and Property replied that the six districts and the county had begun discussions to consider pooling risks relating to the change in business rates. The initiative was designed to even out changes. The county council had the capacity to undertake a modelling exercise and this council had worked with a consultancy called Pixel, who had also worked with Cipfa, to consider a broader model. It was a complex area, which included the need to make a 10 per cent saving for the change from council tax benefit to council tax discount. By working together the councils hoped to be able to work on some of the exemptions and levels of discount to deliver savings. The funding element of risk SR104 was lower.

Cllr Robinson, Cabinet Member for an Efficient Council and Planning Policy added that the Leadership Gloucestershire group had today agreed a joint approach to go forward but with no formal commitment at this stage, aiming to achieve the best for the community.

The Head of Paid Service explained that for risk SR301 the council needed to decide whether site development was best handled by a developer, the council or as a joint project. The exercise represented an opportunity as well as a risk, and the council was receiving good support from the Homes and Communities Agency.

The committee noted the report.

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

Thursday 27 September 2012               Thursday 24 January 2013

Thursday 16 May 2013

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

Thursday 27 September 2012               Thursday 24 January 2013

Thursday 16 May 2013