Agenda and minutes

Members are asked to declare any interest and the nature of that interest which they may have in any of the items under consideration at this meeting.

There were no declarations of interest.

The Chairman to report on any requests to submit petitions or to address the meeting.

There were no petitions or requests to address the meeting.

The Chairman to advise whether they have agreed to any item of urgent business being admitted to the agenda.

There was no urgent business.

To confirm as a correct record the Minutes of the meetings of the Committee held on 19 March 2012 and 16 May 2012.

The minutes of the meeting of the Committee held on 19 March 2012 and 16 May 2012 were agreed as correct records and signed by the Chairman.

** Appendix 1 and 2 to follow. The Accounts, Audit and Risk Committee will scrutinise the 2011/12 Financial Statements on 20 June 2012. Following this review, an update will be provided to Committee Members. **

Report of Head of Finance and Procurement.

Summary

The purpose of this report is for members to consider and endorse the Statement of Accounts for 2011/12 (subject to audit).

Recommendations

The Accounts, Audit and Risk Committee is recommended:

(1)               To consider the Statement of Accounts set out in Appendix 1.

(2)               To note the outcomes from the informal review undertaken on 20June 2012 as set out in Appendix 2.

(3)               To recommend that the “subject to audit” Statement of Accounts approval sign off be delegated to the Chief Financial Officer for signing on or before the statutory deadline of 30 June 2012.

The Committee considered a report of the Head of Finance and Procurement which sought agreement of the Statement of Accounts 2011 – 12.

The Head of Finance and Procurement reported that the informal review meeting on 20 June 2012 raised a total of twenty-two questions and that all of the editorial changes proposed, including signage and brackets, had been made.

Resolved

(1)               That the report be noted.

(2)               That the outcomes from the informal review meeting on 20 June 2012 be noted.

(3)               That it be agreed that the “subject to audit” Statement of Accounts approval sign-off be delegated to the Chief Financial Officer for signing on, or before, the statutory deadline of 30 June 2012.

** Appendix 1 to follow as it is currently being finalised **

Report of Head of Finance and Procurement.

Summary

The purpose of this report is to seek approval for the Annual Governance Statement 2011/12, subject to any amendments the Accounts, Audit and Risk Committee may wish to make.

Recommendations

The Accounts, Audit and Risk Committee is recommended:

(1)               To resolve to consider and approve the Annual Governance Statement "Subject to Audit" 2011/12 (attached as Appendix 1).

The Committee considered a report of the Head of Finance and Procurement which sought approval of the Annual Governance Statement 2011 – 12.

The Committee was advised that the final draft had been circulated on 26 June 2012 and had been signed by the Chief Executive and Leader of the Council.

Resolved

(1)               That the Annual Governance Statement 2011/12 be approved, subject to audit.

Report of Head of Finance and Procurement.

Summary

To receive information on treasury management performance and compliance with treasury management policy for Quarter 1 2012/13 as required by the Treasury Management Code of Practice.

Recommendations

The Accounts, Audit and Risk Committee is recommended to:

(1)               Note the contents of the progress report.

The Committee considered a report of the Head of Finance and Procurement on the Council’s treasury management performance and compliance with the treasury management policy for the first quarter of 2012 – 13.

The Head of Finance and Procurement stated that the Council had invested £10.5 million and £11.7 million with fund managers Tradition UK and Investec respectively and that a further £51 million was managed in-house.

The Committee was informed that the Council regularly reviewed its banking and investment arrangements and that a report would be presented to the next meeting of the Committee that outlined the current options available.

The Committee was advised that despite recent problems regarding a widespread computer failure at the Council’s bank, Natwest, all Council staff received their pay as expected during June 2012.

The Head of Finance and Procurement stated that a report on the Investment Strategy 2012 – 13 would be presented to Full Council in October 2012 and that consequently it would not be considered by the Committee in September 2012.

The Head of Finance and Procurement reported that a report on the Council’s investment in Investec would be circulated to the Committee, in addition to a statement on the position at May and June 2012 during the first quarter.

Resolved

(1)               That the contents of the report be noted.

(2)               That it be noted that a report would be presented to the next meeting of the Committee that outlined the current options available to the Council in relation to its banking and investment arrangements.

(3)               That it be noted that a report on the Council’s investment in Investec would be circulated to the Committee, in addition to a statement on the position at May and June 2012 during the first quarter.

Report of Head of Finance and Procurement.

Summary

This report provides a progress report on the work of external audit.

Recommendations

The Accounts, Audit and Risk Committee is recommended:

(1)               To note the contents of the progress report.

The Committee considered a report of the Head of Finance and Procurement on the progress of the work undertaken by external audit.

The Committee was advised that a certification exercise regarding benefits claims processed by the Council had concluded that the level of errors identified from the sample testing pushed the Council over the acceptable level of errors expected of a Local Authority.

It was reported that following the certification exercise, further detailed work on ‘start dates’ and ‘employment earnings’ was completed and an updated Qualification Letter was presented to the Department for Work and Pensions on 22 May 2012. The letter demonstrated an improved performance by the Council which was now below the upper threshold for local authority errors.

The Committee was informed that the number of these errors was higher than average during 2010 – 11 as a consequence of the transfer to Capita and the fact that claims for housing benefit peaked during the period. Clerical errors could compromise the accuracy of the Council’s figures and officers managed Capita in order to ensure that the level of errors remained as low as possible.

It was reported that the Secretary of State would confirm the Council’s revised repayment rate in relation to local authority errors in due course.

The Head of Finance and Procurement stated that a report would be presented to the next meeting of the Committee on the level of housing benefit errors made, including the ratio of errors to the total number of transactions.

Resolved

(1)               That the contents of the progress report be noted.

(2)               That it be noted that a report would be presented to the next meeting of the Committee on the level of housing benefit errors made, including the ratio of errors to the total number of transactions.

Report of Head of Finance and Procurement.

Summary

This reports sets out the internal audit annual report.

Recommendations

The Accounts, Audit and Risk Committee is recommended:

(1)         To consider and approve this report.

The Committee considered a report by the Head of Finance and Procurement on the Chief Internal Auditor’s annual opinion on the adequacy and effectiveness of the Council’s system of internal control.

The Committee was informed that the programme of internal audit work for the year until 31 March 2012 had been completed, with the exception of the planned Joint Member workshop. The work of internal audit had identified 22 low, 19 moderate and 1 high-rated risks that could prevent the Council from achieving its objectives. It was reported that improvements were required in these areas to enhance the efficacy of risk management by the Council.

It was reported that the high-risk issue pertained to the fact that no purchase orders were in place for 84% of invoices received by the Council in year.

The Head of Finance and Procurement stated that this high-risk issue had been addressed within the Council’s Annual Governance Statement.

The Committee was advised that the number of internal audit findings and recommendations had reduced considerably with a total number of 42 findings in 2011 – 12, compared to a total of 98 findings in the previous year.

Resolved

(1)               That the Internal Audit Annual Report be approved.

Report of Chief Internal Auditor

Summary

This report provides the Committee with an update of the work of Internal Audit since the last meeting.

Recommendations

The Accounts, Audit and Risk Committee is recommended:

(1)               To consider and approve this report.

The Committee considered a report by the Chief Internal Auditor on the progress of the work undertaken by internal audit.

The Committee was advised that a low-risk rating had been issued regarding the Council’s IT firewall as a consequence of significant improvements to previously identified issues and the introduction of new robust controls.

The Head of Finance and Procurement stated that improvements to the IT firewall had been reported within the Council’s Annual Governance Statement and that a report would be presented at the next meeting of the Committee.

The Chief Internal Auditor reported that, at a national level, Local Authorities had successfully delivered against an ambitious programme of savings during the last financial year without any perceived reduction in the quality of frontline services, although there was notable nervousness regarding further financial pressures beyond the current spending review period.

Resolved

(1)               That the Internal Audit Progress Report be approved.

The Head of Finance and Procurement will provide a verbal update to the Committee.

The Head of Finance and Procurement reported that a full report would be presented to the next meeting of the Committee.

The Head of Finance and Procurement will provide a verbal update to the Committee.

The Head of Finance and Procurement reported that a full report would be presented to the next meeting of the Committee.

The following item contains exempt information as defined in the following paragraphs of Part 1, Schedule 12A of the Local Government Act 1972.

3 – Information relating to the financial or business affairs of any particular person (including the authority holding that information).

Members are reminded that whilst the following item has been marked as exempt, it is for the meeting to decide whether or not to consider each of them in private or in public. In making the decision, members should balance the interests of individuals or the Council itself in having access to the information. In considering their discretion members should also be mindful of the advice of Council Officers.

Should Members decide not to make a decision in public, they are recommended to pass the following recommendation:

“That, in accordance with Section 100A(4) of Local Government Act 1972, the press and public be excluded form the meeting for the following items of business, on the grounds that they could involve the likely disclosure of exempt information as defined in paragraph 3 of Part 1, Schedule 12A of that Act.”

Resolved

That under Section 100A of the Local Government Act 1972, the public be excluded from the meeting to enable consideration of Appendices 1a and 1b of the following item on the grounds that, if the public were present, it would be likely that exempt information falling under provisions of Schedule 12A, Part I, Paragraph 3 would be disclosed to them and that, in all circumstances of the cases, the public interest in maintaining the exemption outweighs the public interest in disclosing the information.

The Committee considered the exempt annexes to the Report of the Head of Finance and Procurement which updated Members on the Council’s investments and counterparties at 30 April 2012.

Resolved

(1)               That the exempt appendices be noted.