Meeting documents

Apologies were received from Alan Stevens (Chris Adams attended as substitute), Richard Scott (Tim Butcher Chaired the meeting in place of Richard). It was also notes that Trevor Egleton was currently off sick and therefore would not be in attendance. 

There were no declarations of interest.

of the meeting held on 09 November 2015 to be confirmed as a correct record and signed by the Chairman.

The minutes of the meeting held on 09 November 2015 were agreed as a correct record and signed by the Chairman. The following action points were noted:

·         P4 item 3 - action for Ian Dyson regarding the counter fraud update; Ian Dyson advised the main investigation was  ongoing and that a further update would be provided later in the meeting.  It was also confirmed that an update on business assurance would be provided later in the meeting, along with a verbal report on Business Continuity Management from Andrew Fyfe. 

·         P5, Members Questions; it was highlighted in the minutes that Zahir Mohammed was to clarify details to the Chairman outside of the meeting. As the Chairman Richard Scott was unfortunately not in attendance, the Committee wanted confirmation from Zahir Mohammed that this had been actioned. It was confirmed that the interim Chairman Tim Butcher would raise this with Zahir Mohammed today under the Bucks Learning Trust (BLT) item on the agenda. 

To be presented by Ian Dyson.

Ian Dyson presented the internal audit report with key points being raised as follows: 

·         P23 of Pack, business assurance report.

·         P25 clarity on structure - since the last meeting the assurance team had made another successful appointment with a new audit manager having joined the team. It was confirmed that there was now a  full complement of staff within the Business Assurance team, with the exception on Amy Wadsworth, Business Assurance officer, who was due to return in June 2016 following maternity leave.

·         P26 - highlighted the audit’s that had concluded and those that were at draft report stage, with executive summaries from the completed audits noted at the end of the paper.

·         Client transport safeguarding resulted in limited assurance, when the report was completed in December 2015. This report had been brought to the Risk Management Group (RMG) at the end of December, where the director attended RMG to give an update and to advise that One Council Board (OCB) had considered the paper and the response, details of which were also contained in executive summary.

·         Mandeville school follow up, the Headteacher left and requested a follow up audit to the original audit which was undertaken 2 years ago.  Following the latest audit a number of actions were outstanding however, many of these were in progress and the majority of the significant issues had been addressed with clear plans in place for the remaining issues. It was advised that the Business Assurance team were no longer concerned regarding this.

·         Counter fraud activity- reported previously a number of irregularities, some of which were continuing. The major one was ongoing and the police were about to begin their investigation. Whistleblowing case has also resulted in a follow up audit of processes in Children’s Services, with a number of control issues identified from the main investigation. A further report would come to the Regulatory and Audit meeting in April, once details are finalised.

·         P.29 Direct payments- an audit was underway where consideration would be given to some of the fraud controls. Due to department pressures a workshop with the team to provide guidance and address issues would likely take place in quarter 1 next yr.

·         Business Assurance activity - the Strategic Risk Register (SRR) had been reviewed and refreshed and was now part of regular process at One Council Board (OCB) meetings. Continued to work on compliance with the Operation Framework, had undertaken self-assessments of all the Business Managers within HQ, the next step was to validate the responses with each manager. The results would then feed into the annual review of the Operation Framework, which was being led by Sarah Turnbull.

·         The team continued to work with the Professional leads on their assurance framework- which had taken longer than expected due to more support being needed.  

·         Appendix 1- set out progress against plans and other activity for the remainder of year.

·         Appendix 2- was a summary of completed audits.

·         Supplement- highlighted any actions arising from audits, outlined the tracking system for  ...  view the full minutes text for item 4.

To be presented by Grant Thornton Auditors.

Paul Grady provided an update to the Committee and discussed the report included in the agenda pack. During discussions the following questions were raised by Members: key points were raised:

·         It was queried whether the overall fee from Grant Thornton included the pensions fund? Paul Grady confirmed this was a separate rough fee of £20k, charged back to the pension’s fund.

·         It was queried whether BCC had financial sustainability. Paul Grady confirmed that this was looked at on 2 aspects, 1: an accountants definition of concern e.g. are you able to continue to trade for business for the next 12 months, looking at saving plans/ income streams etc. There was also a wider view in terms of value for money, e.g. by 2020 with challenges and cuts coming, how feasible are the assumptions, how achievable and likely are the schemes in place to be achieved. It was subjective and premature in 2016 to say overall, however Grant Thornton would share any risks with BCC as they arose.

·         It was suggested that it needed to be made clear whether the services were sustainable, as books could potentially be balanced by discontinuing or not providing vital services. Distinction needed to be made between discretionary and core services. Paul Grady agreed and advised that there was a risk of local government becoming a victim of its own success, as the more successful local government becomes the less funding supplied by central government, therefore the risks also increase.

·         It was suggested that a forward view of how realistic BCC budgets were would be helpful, was this possible? Paul Grady advised that Grant Thornton can certainly look at assumptions and underpin the budget figures in there, in terms of the budget previously. In most cases officers had understood why there had been budget pressures, and actions required to address them, however a forward view could be outlined in the future.

ACTION: Paul Grady

·         GROUP AUDIT SCOPE p13 - Components were discussed. It was advised that although some were out of the control of BCC, reputational risk was still a potential issue, e.g. Bucks Learning Trust (BLT). It was questioned whether the audit would pick up any financial irregularities regarding suck areas and if not was this a gap to be looked at? Paul Grady advised that BLT, would not be looked at sperately in terms of the BCC relationship as they would expect disclosures in the council’s report around that area and the audit would cover those disclosures made by the council. The audit would not look at BLT further than that or specificually audit on the numbers as this would be out of the scope of the council. Ian Dyson also advised that BLT would have their own external audit and that BCC’s relationship with BLT in terms of audit, was of broad scope as outlined in the contract management section of the Grant Thornton report, under Commission Spend. Regarding internal audit, Ian Dyson confirmed this had been looked at from a governance perspective.  ...  view the full minutes text for item 5.

To be presented by Grant Thornton Auditors.

Marcus Ward provided a brief update on the report, which referred to the Skills funding agency and teachers pensions reports.  

·         Teachers pensions, a few issues had been highlighted with underlying data, these had been amended and then submitted.

·         Skills funding agency, around BCC subcontracting the funding, no issues were found. Both have been submitted.

·          

Committed noted the report.

To be presented by Matthew Strevens.

Matt Strevens attending the meeting to provide an update to the Committee.

Reminder - the team had been asked to identify what would be best practice for invoicing and/ or receiving payments up front. It was explained to the committee that responsibility for delivering the Debt Management Strategy sat with the Managing Director in each Business Unit, and that reporting was provided to them on a monthly basis to take an overview. Practically this matter was dealt with by the budget holders responsible for the debt and they had access to report on their specific debts whenever they chose to.

·         This report had excluded the secured debt as these would be recoverable.

·         P4- profile of unsecured debt over the last year and 8 months, within 15/16. Ensuring these debts were reported on a monthly basis and to cabinet on a quarterly basis.

·         As BCC moves more towards being a commercial organisation, would expect to see more clients and customers, expectation debt would increase however fluctuates quite significantly.

·         In total difficult to analyse if debt management strategy has had any impact.

·         P 5: compared Quarter 2 and Quarter 3 percentage of debt over 30 days is 10% lower, so action was being taken.

·         Only included those raising invoices and not those taking payments in advance, therefore do not have a clear overall picture.

·         Wider assurance framework, financial assurance framework completed by Finance Director of each Business Unit, therefore debt is being discussed. However, it is a question of engaging with lower levels throughout the teams also.

·         Indicative evidence, but do have significant gaps in knowledge and information to support.

·         Current report does not identify different types of debt, e.g. CCGs, challenged as no mechanism where this could be flagged currently.

·         Developments - currently no reminder message to those responsible to chasing debts - this is being developed to remind at 30 days and 60 days, as well as the current 90 days reminder. 

·         Cultural side- support and guidance for those who have responsibility or role as a budget holder, intranet pages are being developed.

·         Future opportunities, engagement with development team for a more commercial approach are being looked into..

·         ICT tool being developed regarding policy compliance all staff with budget responsibility would have to read the policy, eventually when mechanisms are in place, staff with these responsibilities would not be able to access the system without reading the guidance.

·         Review of the dunning process, for reminder emails, proposing this being 30 60 and 90 days (at present just 90 days)

·         Proposal to start to develop new metrics to get a greater understanding on what the debt is, will also work with the business units to understand where the debt is.

Member Questions

·         Within debt management policy there were regulations around writing off bad debt, with Finance Directors having the authority to write off up to a limit. What was this limit and were Managing Directors and Finance Directors asked to confirm that this debt had been written off where appropriate?  ...  view the full minutes text for item 7.

To be provided by Andy Fyfe.

Andrew Fyfe attending the meeting to provide a verbal report to the Committee. Key points were raised as follows:

·         Internal audit report - 2 issues related to the revision of Business Continuity Management (BCM) policy. The policy was under review currently and following feedback should be in place shortly. Taken note of various changes care act and assurance and risk strategy. Also BCM steering group had been set up.

·         Item- TEE getting the BCM arrangements in place. TfB has an advanced version of BCM, but the other elements within the service do not, although they are engaging. The Internal audit was a snapshot in time and the next deadline was the end of March 2016 for up to date BCM plans from each area to be submitted.

·         Corporate Exercise was carried out 05 November 2015, where 120 staff attended (mainly managers/ directors and OCB). Post exercise report should be completed shortly. Refocussed and engaged various services.

·         Timelines, end of financial year, BCM arrangements in place, have had 1 BCM steering group meeting and second has been diarised. Directors were due to confirm BCM plans in place in the Annual Governance statement.

·         Detailed report on BCM would be brought to the next Regulatory and Audit meeting in April.

Committee thanked AF for the verbal update.

To be presented by David Johnston and Zahir Mohammed.

 Nick Wilson, Interim Director of  Education and Zahir Mohammed, Cabinet Member for Education attended the meeting to provide an update.

The Chairman referred back to the minutes of the last meeting and asked Zahir Mohammed to confirm that as per the Actions noted in the minutes,  feedback on the number of Trustees in place presently and going forward within BLT had been provided to Richard Scott after the last meeting. Zahir Mohammed confirmed that he had communicated directly to Chairman Richard Scott following the last meeting.

The Committee welcomed Nick Wilson to the meeting, following recent appointment into the Interim Director of Education Post, having come from outside of the organisation.

Zahir Mohammed provided a summary to the report, where key points were raised as follows:

·         The highlights within the report were showing good progress, and those that were still marked as red were being worked on.

·         The current Trustees were making arrangements for a new chair at the end of February 2016. 

·         The current Trustees had not been removed yet as the plan was for the whole process to take place following sign off of the accounts at end of February 2016.

·         BCC have had applications for Trustees positions to join the board, interviews had taken place for a number of people, a couple more were to due to be held before an appointment was made. 

·         The plan was for 4 BCC Trustees to be appointed however discussions were ongoing as there may be a BLT board as well as an advisory group. Currently BCC had 1 Member on the BLT board, however discussions were underway on how many BCC would have going forward. 

·         Total Trustees; there were 18 existing however the plan was to reduce this number to 6, although the detail was still being discussed.

Member Comments and Questions

·         A Member suggested that an advisory board was important and that it was key that there was cross over between the two boards, e.g. the Chair for each meeting should attend both boards, even if not as a voting member just to listen in.

·         It was suggested that when recruiting for a new Chair person, ideally would want to have a larger pool of people to search from, did the team have any idea of the background skills required to become a Trustee? Zahir Mohammed advised that a range of skills had been outlined in the job specification, including business skills to drive the strategic agenda of the BLT and monitoring its effectiveness, as well as an education background. 

·         It was queried what the role of the Member / Members on the board would be in respect to the BLT. Would they look after the County Council aspects or were they to represent the needs of the BLT only. Zahir Mohammed confirmed that the Member on the board would be there to represent the BLT and not BCC, although they would  report back to BCC Commissioning group, directly through the Chief Executive or another Commisioning group board  ...  view the full minutes text for item 9.

To be presented by Julie Edwards.

Councillor David Watson and Julie Edwards attended the meeting to provide an update on the Treasury Management Strategy. During discussion key points were raised as follows:

·         Would be moving from an average of £200m in cash investments, down to £20-30m, once the Energy for Waste plant had been paid for (costing £180m plus £36m VAT)

·         Different investment strategy needed, as detailed in the paper.

·         BCC’s attitude to investment and debt was also detailed in the paper.

·         Members queried what had been changed in the policy as this was nit clear. What was different from that had been agreed at Full Council last year? As the Committee were being asked to recommend the Treasury Management Policy at to Full Council on 18 February, Members wanted to be clear on the details of what had changed.

·         Richard Schmidt advised that the figures changed every year and reflected the changes to the capitol programmes e.g. what we need to borrow for. In this instance it was the Energy for Waste plant, which would put BCC in a fundamentally different position than previous years, resulting in only £20-30m left in the reserve fund.

·         It was confirmed that the policy had not changed but the Energy for Waste plant would have an impact on the figures.

·         It was agreed by the Committee that the report should not be sent back to be changed at this last stage due to the Full Council deadline however further clarity was required on the detail.  

RECOMMENDATION: The Committee are asked to RECOMMEND to Council the Treasury Management Policy Statement, Annual Investment Strategy and the Minimum Revenue Provision Policy statement for 2016/17, together with the Prudential Indicators for the next four years.

DECISION: The Committee agree to the recommendation , subject to a further clarified report being circulated offline to Members of the R&A committee by DW/JE- h/lighting the previous years figures.

(NB Richard Schmidt circulated the additional information requested outside of the meeting, report attached for information).

To be presented by Maggie Gibb.

Maggie Gibb provided a summary of the discussions held at the Risk Management Group Meeting on 14 January 2016. During discussion key points were raised as follows:  

·         Strategic Risk Register- discussed at One Council Board (OCB)

·         High level risks from all Business Units and HQ - those risks scoring more than 15, how we ensure the BU are using the RR as an effective management tool. Started to enhance the role of the risk champions, responsible for helping embed risk framework in bu’s.

·         Each bu should be considering risks of regular basis , will provide further details on RR of direction of travel

·         EfW RR - has come back on a reg basis since started. Very detailed update given and talked through RR.

·         Childrens services - general update across whole of BU on how risks are being managed. Also specific risks as  part of the improvement plan as well as BLT. Group received report, detailed explaination how being managed.

MQ

·         BC - are we assured that all those who assess risk have a standard key to work at - eg all scoring the same across the board.

·         Always will be some subjectivity but do have framework on how to score with different levels of impact - eg monetary values. Do challenge if it looks like they are being incorrectly scrored. Has got btter and more consistent. Have a more robust process for revieweing the high level risks and would expect action to be  taken against these risks where possible. System does provide consistency around the scoring, with a lot of guidance and training.

ID- RMG - omission that all members o R&A should receive all papers in relation to the RMG- going forward will all start receiving these confidential papers for info. all are entitled to attend but are core members.

Certain r registers - need to be printed as hard to see on screen

Refer details on dates of the meeting - available on forward plan

Standing item to be presented by Ian Dyson and Maggie Gibb.

It was confirmed that following the Pre-meet and todays Committee meeting the following items would be added to the forward plan:

Meeting on 27 April 2016

·         Bucks Learning Trust Update  

·         Draft 16/17 audit plan

·         Inspection REPA Covert surveillance inspection

·         Whistleblowing Policy - incidents and effectiveness

·         Outside Bodies Update

Meeting on 25 May 2016

·         Statement of Accounts

·         Annual Governance Statement

·         Annual Report of Chief Auditor

Meeting on 28 July 2016

·         Debt management update - 6 months on

·         Audit of accounts  

To be held on 27 April 2016 at 9.00am.

The Committee were advised that the next meeting would be held on 27 April 2016.