Venue: Room 1, Civic Centre, Silver Street, Enfield, EN1 3XA. View directions
Contact: Metin Halil
WELCOME AND APOLOGIES FOR ABSENCE
Councillor Mahym Bedekova (Chair) welcomed everyone to the meeting.
Apologies for lateness were received from Councillors Leaver and Savva.
Councillor Lindsay Rawlings attended the meeting as an observer.
Also attending was one member of the Public.
DECLARATION OF INTEREST
Members of the Audit & Risk Management Committee are invited to identify any dis-closable pecuniary, other pecuniary or non – pecuniary interests relevant to items on the agenda.
There were no declarations of interest.
To receive from BDO (external auditors) the ISA260.
RECEIVED from BDO (external auditors) the Audit Completion Report on the Statement of Accounts 2017/18.
1. The report presented BDO’s audit findings of the 2017/18 Statement of Accounts, the financial statements opinion. The report was introduced by David Eagles (BDO) and was presented in the ‘2nd To Follow Agenda’.
2. Many of the issues within this report were seen and discussed at the Committee meeting held on the 26 July 2018. Therefore, focus was given on the items that had moved on since then with updates in terms of the audit and how far away BDO were as regards the sign off of the 2017/18 Statement of Accounts.
3. There was concern about the lateness of the audit opinion and BDO had now mapped out the process for addressing the issues that they had encountered for 2017/18, so as, to assure the Council that this doesn’t re-occur next year.
4. BDO would be having a thorough internal de-brief and then come to the Council to discuss with officers their suggestions for how BDO, as a team with the Council, can change things for next year. By taking things out of the peak areas, to address things at a different stage or in a different way so that the same situation did not arise again.
5. There would be an agreed action plan, coming to the next committee meeting on the 10 January 2019, so as to explain what has been agreed.
6. David Eagles apologised for being so late with the 2017/18 Statement of Accounts sign off, but he would be talking through the issues that BDO had found, since the last Committee meeting on the 26 July 2018.
7. BDO had also been liaising with the PSAA about correspondence that had been made.
8. David Eagles drew attention to the overview of audit matters as detailed from page 3-7 of the report.
9. In terms of material issues that BDO had identified during the course of the work, as detailed on page 5 of the report, there were a number of issues found relating to re-valuations and links between the asset register system, the accounts and some amendments that were made relating to valuations. Large figures were quoted here but no bottom line effect on the general fund.
A number of technical issues were found relating to accounting for deferred capital receipts which is an accounting mechanism to reflect transactions on loan re-payments, as detailed on page 5 of the report.
10. Page 6 of the report, highlighted a number of un-adjusted areas differences which are further detailed within the appendix from page 27 of the report.
11. In terms of Key Audit and Accounting matters, as detailed from page 9 of the report:
a. Management override of controls – these were addressed at the last meeting. The valuation issues have been expanded in more detail with separate risks. No further issues to report.
b. Revenue Recognition – some basic issues which were concluded at the 26 ... view the full minutes text for item 813.
IGB ANNUAL PERFORMANCE HALF YEAR UPDATE 2018/19 & GDPR IMPLEMENTATION
To receive the report of the Director of Finance presenting the Information Governance Board’s half year annual performance update 2018/19 and the implementation of the General Data Protection Regulations (GDPR).
This item has been deferred to a future Audit & Risk Management Meeting.
To receive a report from the Director of Finance presenting the Internal Audit Progress Report for 2018/19.
RECEIVED the report of the Director of Finance presenting the 2018/19 Audit & Risk Management Service progress report.
1. The Chair welcomed Gemma Young (Head of Internal Audit & Risk Management) to the meeting. Gemma Young is the Head of Audit & Risk Management at Waltham Forest Council and she had been asked to also become the head at Enfield Council.
2. Gemma Young had also been asked to progress a shared service aswell and would report back to the committee as that progressed.
3. As detailed at 3.5 (page 2) of the report, the service progress update to 30 September 2018 highlighted the following:
a. 6% of assignments were complete.
b. 18% of fieldwork in progress.
c. 34% Planning stage.
d. 12% of draft reports issued.
e. 30% had yet to be started.
Annex1 (pages 9-10) provided more detail on the audit progress.
4. In terms of changes to the 2018/19 internal audit plan, as detailed at 3.6 (page 3) and Annex 2 (pages 11-12) of the report. Since approved by the committee in March 2018, 19 assignments had been added and 5 deferred/cancelled.
5. In terms of managers’ progress with implementing internal audit actions, as detailed from 3.8 (page 3) of the report and Chart 2 (page 4) of the report. The team had followed up 129 actions, 38 relating to high risks, and 91 medium rated risks. Overall, 63% of the high priority recommendations have been fully implemented with 29% of the medium risks fully implemented. These would be followed up until all implemented. Annex 3 (page 13) of the report provided more detail.
6. In terms of Counter Fraud achievements, there is an annual target to recover 60 council properties and have recovered 42 so far to the end of September 2018. Temporary accommodation recoveries annual target is 40 and the team had recovered 16 to date. Savings made to 30 September 2018 have been £1.56m with the annual target being £2m.
7. As detailed at Table 4 (page 5) of the report, Internal Audit Quality Assurance measures.
8. The following questions raised in response to the progress report:
a. At present the proposed shared service centre was an idea. It’s a plan to join up the 2 boroughs, sharing audit fraud teams and possibly a risk management service. In terms of audit and fraud, it would be beneficial to share best practise and a pool of staff. Other heads of shared services will be consulted for their views and benefits of a shared service. Gemma Young will be putting a business case together.
b. Peter Nwosu questioned the changes to the 2018/19 internal audit plan as regards the addition of 19 assignments and how that would impact on the team’s progress bearing in mind that only 6% of assignments are at final report stage to date. Gemma Young clarified that although only 6% of assignments are at final report stage, this wasn’t unusual for this time of the year. As the team have a good relationship with ... view the full minutes text for item 815.
To receive the report of the Director of Finance presenting a Financial Resilience update.
RECEIVED the report of the Director of Finance presenting a Financial Resilience update.
1. The purpose of the report was to talk about areas that put the Council’s financial resilience at risk and some of the things that the council is doing to address and meet those risks. In recent years the committee have had reports on financial resilience, but not this style of report.
2. The areas of risk currently (as detailed at paragraph 1 on page 1 of the report):
· The council overspend, recently reported to Cabinet.
· Budget pressures and the delivery of savings.
· Deliverable income and savings proposals for the 2019/20 budget.
· Capital Programme – the council needs to think about the capital elements of its financial resilience and a new requirement by CIPFA for a Capital Strategy.
· Levels of the council’s financial resilience – need to ensure that financial reserves are at the correct level.
3. The following issues raised in response to the report:
a. Councillor Leaver recalled that at the 5 July 2018 meeting, the committee asked for more of an understanding of reserves which had been mentioned briefly in this report. This would represent the financial resilience the council has. Fay Hammond apologised and confirmed that she could have provided an annex in this report about that.
b. Councillor Leaver questioned the Capital Board requirement by CIPFA and if every council project that is heard at Cabinet would now also be heard at the Capital Board. Fay Hammond clarified that this hasn’t happened in the past but would be happening now. In the past a school or regeneration project would be discussed at EMT (Executive Management Team) but the purpose of the Capital Board would be to see the strategic picture and balance those things up against each other. This was not happening at present.
c. Councillor Leaver asked if it was about capital or risk. Was the purpose of this audit action (Capital Board) to ensure that proposals that go to Cabinet are resilient or was it to assess that whatever comes through is agreeable. Fay Hammond clarified that there was a multiple list. Budget reports are often over estimated for council spending, so the council wants to ensure that more time is spent looking at estimates for correctness because if they are not right this would free up capital. Capital projects revenue implications are done through the Cabinet process but are being duplicated by services rather than having an overview. It was about bringing that together.
Members concern that if capital projects go through the Capital Board then nothing would move or get to Cabinet.
AGREED that Audit & Risk Management Committee note the contents of the report.
Audit & Risk Management Committee
a. To receive and agree the minutes of the Audit Committee meeting held on Thursday 5 July 2018 and Thursday 26 July 2018 as a correct record.
b. To note the update on actions identified at the last meeting.
AGREED that the minutes of the Audit Committee meeting dated 20 June 2018 be approved and signed as a correct record.
The Committee is asked to agree the Work Programme put forward for the 2018/19 municipal year along with the timetabling of each issue on the Work Programme.
RECEIVED an outline work programme for the Committee covering the 2018/19 Municipal Year Committee.
AGREED to approve the outline work programme for 2018/19.
1. The error on the published agenda regarding the March 2019 Committee meeting.
The date should have been Wednesday 6 March 2019.
DATES OF FUTURE MEETINGS
To note the dates agreed for future meetings of the Audit & Risk Management Committee:
Thursday 10 January 2019
Thursday 7 March 2019
(All meetings to commence at 7.00pm unless otherwise agreed.)
NOTED the dates of future meetings:
Thursday 6 December 2018 – Special meeting
Thursday 10 January 2019
Wednesday 6 March 2019
(All meetings to commence at 7.00pm unless otherwise agreed.)