Meeting documents

RESOLVED –

That Councillor Hewson be elected Chairman of the Committee for the remainder of the municipal year.

RESOLVED –

That Councillor B Chapple OBE be elected Vice Chairman of the Committee for the remainder of the municipal year.

Any changes will be reported at the meeting.

The Committee was informed that there had been two permanent changes to the Conservative membership of the Committee, with Councillors Branston and Irwin replacing Councillors Mills and Mrs Renshell.

To approve as a correct record the minutes of the meeting held on 9 November 2015, attached as an appendix.

RESOLVED –

That the minutes of the meeting held on 9 November 2015 be approved as a correct record.

To consider the report attached as Appendix B.

Contact Officer: Kate Mulhearn  (01296) 585724

The Committee received a report from the External Auditors on their work associated with the certification of grant claims for 2014/15 submitted by AVDC.  This was the seventh year that an audit of grant claims had been done.

Certification work was not an audit.  It involved executing prescribed tests which were designed to give reasonable assurance that claims and returns were fairly stated and in accordance with specified terms and conditions. Under section 28 of the Audit Commission Act 1998, as transitionally saved, the Audit Commission made arrangements for certifying claims and returns in respect of the 2014/15 financial year.  These arrangements required only the certification of the housing benefits subsidy claim.  In certifying this the external auditors followed a methodology determined by the Department for Works and Pensions.

The external auditors had checked and certified the claim for the housing benefits subsidy claim with a total value of £44,815,924.  The certification work had found errors which had required the external auditors to carry out extended testing in several areas.  The identified errors had been amended by the Council and had a small net impact on the claim.  Underpayments, uncertainties and the extrapolated value of other errors were included in a qualification letter and further details of these were included in the Committee report.

The indicative fees payable for the grant claim work for 2014/15 was £16,600, which was a slight increase on fees payable for the 2013/14 work.  The increase was attributable to the additional testing (40+) that had to be carried out in response to the errors identified but had been completed in time for the submission deadline.

Members requested additional information and were informed that, in total, the auditors had checked 100 claims.

RESOLVED –

(1)       That thanks be passed to the Revenues and Benefits Section for the good work that had been done in administering the claims for the financial year 2014/15.

(2)       That the external auditors report on the certification of claims and returns by AVDC for 2014/15 be noted.

To consider the report attached as Appendix C.

Contact Officer: Kate Mulhearn (01296) 585724

The Committee received a progress report summarising the work already undertaken and the work planned for 2016 in accordance with statutory requirements and to ensure it was aligned with the Committee’s expectations.

The auditors would continue to hold regular meetings with key officers as part of their on-going audit process including fortnightly meetings with key finance staff during the audit opinion visit to discuss significant risks around the accounts and updates on work, and quarterly meetings with the Director of Finance and senior Finance Officers to discuss the significant risks and other issues faced by the Council and the approach and progress with the audit.

The progress report included a timetable setting out how key audit work would be phased during 2015 and when the key deliverables and outcomes would be reported to the Audit Committee. The Audit Plan would be discussed with senior managers in late January  early February and reported to Members in March 2016.

Members were informed that the Department of Communities and Local Government (DCLG) had announced that it had decided not to extend the existing arrangements for external audit contracts beyond the end of 2017/18.  From 2018/19 onwards, local authorities would be responsible for appointing their own auditors, and directly managing the resulting contract and the relationship.

The National Audit Office had consulted on a draft Auditor Guidance Note in respect of auditors’ work on value for money (VFM) arrangements.  The guidance had now been issued and set out the proposed overall approach to work on VFM arrangements that would apply to audits from 2015/16 onwards.  An initial VFM risk assessment would be carried out in early 2016 and be reported to the Audit Committee in March 2016.

In addition to the formal reporting and deliverables, the external auditors would continue to seek to provide practical business insights and updates on regulatory matters through their Sectors Briefings. The Local Government Audit Committee Briefing (November 2015) was attached to the Committee report.

Members requested further information and were informed:-

(i)         (Local government audit committee briefing) – Local Plans – that the auditors were bringing this information to the attention of the Council although it was not something that they intended to audit.  The auditors agreed to clarify the accuracy of the data quoted regarding published local plans. 

(ii)        (Local government audit committee briefing) – Housing Associations Right to Buy – that key issues for AVDC relating to RTB would be reported to the March 2016 meeting.

RESOLVED –

That the contents of the External Auditor’s progress report and the progress of work undertaken to date, and planned for 2016, be noted.

To consider the report attached as Appendix D.

Contact Officer: Craig Saunders (01296) 585724

The Committee received an update on the anti fraud and corruption work that had been undertaken over the last 12 months including the results of the fraud risk benchmarking assessment, and a report on the activity of the Compliance team for the first six months of 2015-16 following the transfer of staff to the DWP’s Single Fraud Investigation Service (SFIS).

In October 2013, an assessment was performed of the Council’s Anti Fraud and Corruption polices and processes compared to the three themes outlined in the Local Government Fraud Strategy: Acknowledge, Prevent and Pursue. The actions identified in the Anti-Fraud and Corruption Improvement Plan had largely been addressed and were reported to the Audit Committee in October 2014.

Since the previous fraud risk assessment new best practice guidance on anti-fraud in the public sector had been released by the Chartered Institute of Public Finance and Accountancy (CIPFA).  In addition, the Council had undergone significant change with corporate restructure, setting up the new business model and seeking to increase commercial trading.  The transfer of the Fraud Investigations team to the DWP SFIS had also had an impact on resources available and the mandate for investigation.

CIPFA's "Code of practice on managing the risk of fraud and corruption" supported organisations seeking to ensure they had the right governance and operational arrangements in place to counter fraud and corruption.  It was a voluntary code that could be applied in any public service organisation.

In March 2015 the Fraud Investigation Team transferred to the DWP SFIS as part of the government’s new aims to try to tackle welfare benefit fraud.  This had left the Council without a dedicated fraud investigation resource.  The Compliance Team which was part of the Revenues and Benefits Service had been established to undertake interventions and reviews of customer’s council tax liability, housing benefit and council tax reduction entitlement, and to ensure account/claim records were correct, identifying errors and recovering overpayments as well as applying penalties where appropriate.

Attached as Appendix A to the Committee report was a summary (mid year report) of the Compliance Team’s work for the first half of 2015-16.

Using the CIPFA Tool, Business Assurance Services (BAS) had performed a fraud benchmarking assessment of the current state of the Council’s governance structures and processes against the CIFPA code.  The results of the assessment and action plan were attached at Appendix B to the Committee report.  The Council was currently performing at 40% of the CIPFA standard.  For an organisation of this size and complexity aiming for 100% may not be appropriate, but the assessment showed that there were some key areas where further attention was needed to strengthen both the governance and operational arrangements in place to manage the risk of fraud.  The actions identified would help to improve the Council’s governance structures and ability to demonstrate effective financial stewardship and strong public financial management.

Members referred to Appendices A and B and in response to questions were provided with further information as follows:-

(i)  ...  view the full minutes text for item 7.

To consider the report attached as Appendix E.

Contact Officer: Kate Mulhearn (01296) 585724

The Committee received a progress report against the 2015/16 Business Assurance Plan that highlighted the following matters:-

(i)         Assurance reviews completed since the last progress report:

Housing Allocations – the process and controls for Housing Allocations including processing applications in accordance with Bucks Home Choice policy had been reviewed.  Generally the processes operated by AVDC’s Housing Service was good and had been given an overall reasonable assurance rating.

One medium priority recommendation had been raised relating to a wider review against the BHC policy objectives, recommending that an annual review of the objectives was undertaken.

Two low priority recommendations relating to the ‘Common Housing Register and Nomination Rights’ in place between AVDC and the Vale of Aylesbury Housing Trust and ensuring that routine management checks were carried out at the point of entry to the housing register had also been raised.

(ii)        Assurance Plan Work in Progress – the following work from the 2015/2016 plan had started:-

·                     Technology One (Accounts Payable / Debtors) – actions were being agreed with management based on a draft report and recommendations that had recently been issued.  The report would be presented to the Committee in March 2016.

·                     Council Tax and Business Rates collections – the review was being scoped with a view to issuing terms of reference and starting the review in January 2016.

·                     Housing Benefits and Council Tax reduction – the review was being scoped with a view to issuing terms of reference and starting the review in January 2016.

·                     Data Protection – Home working and use of personal devices – a high level scope had been provided to an external provider and the Council was awaiting quotes that would then allow the detailed scope and start date to be confirmed.

·                     Policy Compliance – Policy Hub had gone live in November 2015.  A compliance programme was being planned including policy review and update and staff training.

(iii)       Service Risk Assurance – the Service Risk Assurance process had commenced in December 2015.  The information submitted was being reviewed and risk rating updated with a view to reporting the results to the Committee in March 2016.

(iv)       Revised Assurance Plan – the revised Plan had been approved by Members in September 2015.  The plan had been further reviewed and updated to reflect changes which meant that some reviews were no longer a priority for this year and, in other cases, they had been merged with other reviews or removed altogether.  Appendix 2 to the Committee report detailed the work completed, outstanding and the changes.

(v)       Overdue Audit Recommendations and follow up work

·                     Technology One – an update on the new finance system had been reported to Members in November 2015 regarding identified financial control weaknesses that had not yet been addressed.  As previously reported, the Assurance Plan review work on Technology One was being completed and the results would be reported to the Committee in March 2016.

·                     Transparency Code – the two areas that had previously not been compliant, relating to data about  ...  view the full minutes text for item 8.

To consider the work programme attached as an appendix.

Contact Officer: Kate Mulhearn (01296) 585724

The Committee considered the future Work Programme for 2016 which took account of comments and requests made at Audit Committee meetings and the requirements of the internal and external audit processes.  Additions to the Work Programme included:-

·                    Audit Committee Annual Report – moved to 25 July 2016 meeting.

·                    Fraud Progress (information on historical levels of fraud) – report to 21 March 2016 meeting.

·                    Fraud Progress (Compliance Team full year report and report on fraud risk actions) – report to 25 July 2016 meeting.

·                    Governance arrangements regarding the Council’s interaction / monitoring of commercial companies set up over the last 12-18 months – report to the March 2016 meeting.

Members commented that they would like to receive more frequent information reported to the Committee on the performance and management of strategic risks, and were also informed that where New Homes Bonus money was awarded to Parishes for local projects, Parishes were then only paid that money upon the production of paid invoices.

RESOLVED –

That the future Work Programme as discussed at the meeting be approved.

Future meetings are planned as follows:-

·         6.30pm on 21 March 2016

·         6.30pm on 25 July 2016

·         6.30pm on 26 September 2016

·         6.30pm on 14 November 2016

The next meeting of the Audit Committee would be held at 6.30pm on 21 March 2016 in the Olympic Room at The Gateway, Gatehouse Road, Aylesbury.