Agenda and minutes

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Venue: Committee Room 1 - Council Offices

Contact: Ann Holmes 01248 752518 

Items
No. Item

1.

Declaration of interest

To receive any declaration of interest by any member or officer in respect of any item of business.

Minutes:

No declaration of interest was received.

2.

Minutes of the 25th July, 2017 Meeting pdf icon PDF 287 KB

To present the minutes of the previous meeting of the Audit and Governance Committee held on 25th July 2017.

Minutes:

The minutes of the previous meeting of the Audit and Governance Committee held on 25th July, 2017 were presented and were confirmed as correct.

 

Arising thereon –

 

With regard to the Housing Maintenance Unit and the issues highlighted by an internal audit review regarding the Orchard System which the service uses to manage its housing assets which, the Committee sought further clarification that the system is effective and fit for purpose, the question not having been answered to a sufficient degree at the previous meeting to provide the Committee with the assurance that that is the case.

 

The Head of Function (Resources) and Section 151 Officer said that the Orchard Housing Management System has been in use for some time and a decision will need to be made either to renew the system or to tender for a new system. This will be dependent on evaluating whether Orchard is still the right system to meet the needs of the Housing Service and the Housing Maintenance Unit going forward. This assessment will take place in the coming months before a final decision is made with regard to the Housing Management system.

3.

Information Governance - Annual Report of the Senior Information Risk Owner (SIRO) pdf icon PDF 671 KB

To present the Annual Report of the SIRO for 2016/17.

Minutes:

The report of the Senior Information Risk Owner (SIRO) which provided an analysis of the key information governance issues for the period from 1 April, 2016 to 31 March, 2017 along with current priorities was presented for the Committee’s consideration.

 

The Head of Function (Council Business) and Designated SIRO reported on the salient point as follows –

 

           That the main statutory driver with regard to Information Governance at the Council is currently the Data Protection Act significant breaches of which can result in large monetary penalties, currently up to a maximum of £500k.

           A considerable amount of audit work, including that of the Information Commissioner’s Office (ICO) (2013-14) has highlighted deficiencies in the Council’s data protection arrangements. Since 2013, the Council has invested in improving its compliance with the Data Protection Act and now has in place the relevant policies and procedures to support and to demonstrate compliance with the Act.

           The work that has been done to date and is ongoing and will continue in perpetuity. It is being led by the Corporate Information Governance Board which was established in 2014 originally as a project team to respond  to the recommendations of the ICO audit from 2013.The Board is now a permanent governance structure and reports to the Senior Leadership Team. A summary of the work which the CIGB has and continues to be engaged with is provided at section 5 of the report.

           This work includes developing an initial version of the Council’s Information Asset Register (IAR). The register allows the mapping of information content and information systems as they interact with changes to business requirements and the technical environment and is a key mechanism for understanding an organisation’s information holdings and the risk associated with them. Whilst the intention was to undertake further work on the Information Asset Register to assess high risk areas for data breaches, the forthcoming General Data Protection Regulations (GDPR) which will replace much of the existing data protection legislation in May, 2018 requires that work on other aspects of the IAR be prioritised. Guidance from the ICO is to focus on work relating to retention schedules. The Council’s retention schedules have now been completed on a service by service basis and will be circulated to Heads of Service. The new legislation will make complying with destruction dates on data held electronically and on paper fundamentally more important so the retention schedules represent a key step in that direction.

           The Council has devised IG policies and procedures over time and they are currently up to date. The Council has implemented a policy management system, Policy Portal which has served as a library of policies since November, 2016. Paragraph 5.3 of the report lists the policies available on the Portal. The system is useful in providing clear version control in terms of which policies are current as well as upcoming review dates. The click to accept function provides assurance that key IG policies are being read, understood and formally  ...  view the full minutes text for item 3.

4.

Concerns, Complaints and Whistleblowing 2016/17 pdf icon PDF 609 KB

To present the Annual Report for 2016/17.

Minutes:

The report of the Head of Function (Council Business)/Monitoring Officer setting out the issues arising under the Council’s Concerns and Complains Policy for the period from 1 April, 2016 to 31 March, 2017 along with a summary of whistleblowing issues notified during the same period was presented for the Committee’s consideration. The report included Social Services complaints but only those where the complainant was not a service user. Service user complaints are dealt with under the Social Services Policy – Representations and Complaints Procedure for Children and Adults and are reported annually to the Corporate Scrutiny Committee.

 

The Head of Function (Council Business)/Monitoring Officer reported as follows –

 

           That 191 concerns were received and 74 complaints made during the period covered by the report. Of the 74 complaints 3 were not pursued for the reasons outlined meaning therefore that 71 complaints were investigated and formal responses sent to complainants.

           Of the 71 complaints dealt with during the period, 12 were upheld in full; 10 were partially upheld and 48 were not upheld. 24 complaints were referred to the Public Services Ombudsman for Wales (PSOW) but none was accepted for investigation. Of the complaints to the PSOW, 12 had been dealt with through the internal process during 2016/17 whilst the remaining 12 took their complaints directly to the PSOW.

           There has been an increase of 12 in the number of complaints received from the 59 received during 2015/16. Some services have received complaints for the first time; some have received complaints on account of an increase in fees; others are due to a change in policy e.g. the 3 weekly bin collection and charges for new bins introduced by the Waste Management Services. These changes led to an increase in the volume of telephone calls to the service which then resulted in concerns and complaints about the time taken to answer calls.

           The overall rate of responses to complaints issued within the specified time limit of 20 working days is 93%. When responses are late, the service is expected to send a holding response to the complainant to keep them informed of progress; the reasons for the delay and estimated response time.

           A summary of complaints by service is provided in paragraph 8 of the report.

           From an analysis of the above, 21% of the complaints received resulted from escalated concerns; 72% of complaints were made directly to the formal internal process and the remaining 7% were sent to the Council by the PSOW who refused to deal with them until the internal Council process had first been exhausted.

           The Concerns and Complaints Policy places an emphasis on learning lessons from complaints and thereby improving services. Enclosure 1 to the report seeks to explain what lessons have been learnt and any practice which has evolved as a consequence. However, apart from the Waste Management issues reported in the last report and the Waste Management issues this year relating to changes in policy which suggest  ...  view the full minutes text for item 4.

5.

Statement of Accounts and ISA 260 Report pdf icon PDF 16 MB

·        To present the Statement of the Accounts for 2016/17.

 

·        To present the External Auditor’s report on the audit of the Financial Statements.

 

Additional documents:

Minutes:

5.1       The report of the Head of Function (Resources) and Section 151 Officer incorporating the final Statement of Accounts 2016/17 was presented for the Committee’s consideration and acceptance.

 

The Committee was informed that the draft Statement of Accounts was presented for audit on 28 June, 2017. The detailed audit work is now substantially complete and the Auditor’s report has been issued and a small number of amendments to the draft have been incorporated into the accounts.

The statutory deadline for the completion of the audited accounts 2016/17 has again been met. Improvements identified by the previous year’s audit have been implemented and these improvements have continued. All issues raised throughout the audit have been dealt with promptly and in a satisfactory manner. Details of the main amendments to the draft accounts are covered by the Auditor’s report. All amendments which have been agreed as requiring restatement by Deloitte have been processed and are within the Statement of Accounts. A summary of the significant amendments to the draft Statement is provided in section 3.2 of the report. The Auditors have made 8 recommendations in relation to accounting and payroll control; 6 recommendations in relation to IT and 7 recommendations in relation to Asset Valuation.

 

5.2       The report of the External Auditor on the audit of the Financial Statements 2016/17 (ISA 260 Report) was presented for the Committee’s consideration.

 

Mr Ian Howse, Engagement Lead for Financial Audit reported as follows –

 

           That the draft financial statements for the year ended 31 March, 2017 were received by the Auditors on 12 June, 2017 and that the audit work thereon is now substantially complete. At the date of issue of the audit of financial statements report, the three matters set out in section 6 of the report were outstanding.

           Subject to the satisfactory completion of outstanding work, it is the Auditor General’s intention to issue an unqualified audit report on the financial statements once the Authority has provided a Letter of Representation based on that set out in Appendix 1 to the report.

           As regards significant issues arising from the audit, there is one prior year uncorrected misstatement which has been discussed with Management but remains uncorrected. It was agreed that it did not require restatement as there would be no material impact on the balance sheet in 2016/17. Further details are provided in Appendix 3 to the report.

           There are misstatements that have been corrected by Management which are drawn to the Committee’s attention due to their relevance to its responsibilities over the financial reporting process. These are set out with explanations in Appendix 3.

           The Financial Audit Plan provided information regarding the significant audit risks that were identified during the Auditors’ planning process. The table at section 12 of the report sets out the outcome of the Auditors’ audit procedures in respect of those risks. The audit was conducted in line with the Financial Audit Plan.

           In the course of the audit, consideration is given  ...  view the full minutes text for item 5.

6.

Internal Audit Update pdf icon PDF 818 KB

To present the Head of Internal Audit and Risk.

Minutes:

The report of the Head of Audit and Risk which provided an update on Internal Audit’s progress with regard to service delivery and reviews completed was presented for the Committee’s consideration.

 

The Head of Audit and Risk reported as follows –

 

           That 5 internal audit review reports were finalised in the period as detailed in paragraph 3.2 of the reports. Two of the reports – School Transport and Corporate Procurement Framework – Corporate Compliance resulted in a Limited Assurance opinion. The Committee was provided with the full Limited Assurance reports separately to the agenda.

           That follow up reviews of two areas previously assessed as providing Limited Assurance, namely the Housing Maintenance Unit and ICT Disaster Recovery show that the Council has demonstrated good progress in implementing the actions agreed to address the risks identified in areas, and consequently the Housing Maintenance Unit has now been reassessed as providing Reasonable Assurance and ICT Disaster Recovery as providing Substantial Assurance.

           To date, the Internal Audit Service has completed 22% of the Annual Plan with a further 17% currently work in progress. The internal audit approach is being reviewed; additionally, due to changes in corporate fraud arrangements and significant slippage from 2016/17, the resource available to complete the Operational Plan for 2017/18 has been reduced. The Head of Audit and Risk will undertake a risk assessment during quarter three and audit reviews will be prioritised to ensure resources are targeted to the areas of highest risk.

           The Committee’s terms of reference were scheduled to be submitted to this meeting line with the Forward Work Programme. However due to two issues – the scheduling of  training on 15 September when Members will have an opportunity to review the terms of reference for appropriateness and the publication of updated CIPFA guidance in November, 2017 it is proposed that the review of the terms of reference be deferred until the Committee’s December, 2017 meeting.

 

The Committee considered the information presented and made the following points:

 

           The Committee noted with disquietude the number of concerns highlighted by the Limited Assurance review of School Transport in relation to the monitoring of contractor compliance; controls over expenditure and income collection. The Committee sought assurance that speedy action is being taken to address the systemic and procedural weaknesses identified so that it can be demonstrated that contractors are fully compliant with contract requirements; that the service is cost-effective and that sound arrangements are in place to ensure that all income due to the Council is being collected.

 

The Head of Function (Resources) and Section 151 Officer said that the Executive in 2016 allocated £1m from General Balances to address Business process issues within various areas of the Council including school transport. The Education Service in Anglesey along with those of the five other North Wales authorities have signed up to the ONE software system as part of a collaborative procurement exercise. One of the system’s modules relates to school transport and utilises information about pupils’  ...  view the full minutes text for item 6.

7.

Outstanding Internal Audit Recommendations pdf icon PDF 827 KB

To present the report of the Head of Audit and Risk.

Minutes:

The report of the Head of Audit and Risk setting out the current outstanding recommendations/risks as at 7 September, 2017 was presented for the Committee’s considerations. Details regarding the risk status of each recommendation along with the planned implementation date was provided in Appendix A to the report.

 

The Head of Audit and Risk reported that that the new internal audit approach entails raising issues and risks rather than making recommendations. These are then graded in accordance with the Council’s risk management framework so that internal audit work is aligned to the Council’s risk appetite. The graph at 3.4 of the report shows that performance in implementing recommendations and/or addressing risks has steadily improved over the last 12 months.

 

The Committee noted the information presented and the improvement made.

 

It was resolved to accept and to note the report.

 

NO ADDITIONAL ACTION PROPOSED

8.

Internal Audit Charter pdf icon PDF 658 KB

To present the report of the Head of Audit and Risk.

Minutes:

The report of the Head of Audit and Risk incorporating an updated Internal Audit Charter was presented for the Committee’s consideration.

 

The Head of Audit and Risk reported that the role of the Head of Audit and Risk changed with effect from 1 April, 2017 to include responsibility for risk management and insurance activities. The Public Sector Internal Audit Standards require that the charter describes the safeguards to limit impairments of independence or objectivity if internal audit or the chief audit executive undertakes non-audit activities. Therefore the charter has been updated and amended to include these safeguards.

 

The Committee sought assurance that Internal Audit is sufficiently resourced to be able to undertake its responsibilities properly. The Head of Audit and Risk said that it was her role as part of the Service’s annual report to provide the Committee with assurance about the Council’s internal control arrangements; based on that and the current IA Operational Plan, she was able to provide assurance as to the adequacy of the resources within Internal Audit. However, the service would find it difficult to cope with any reduction in the resources it has at present.

 

It was resolved to approve the Internal Audit Charter which includes the safeguards to limit impairments of independence or objectivity which may be caused by the chief audit executive undertaking non-audit activities, namely responsibility for risk management and insurance.

9.

Forward Work Programme pdf icon PDF 336 KB

To present the Committee’s Forward Work Programme.

Minutes:

The Committee’s Forward Work Programme was presented for review and comment.

 

Mr Gwilym Bury, WAO Performance Audit Lead informed the Committee that he would be providing an update on the WAO’s Performance Work Programme to the Committee’s December meeting.

 

It was resolved to accept the Forward Work Programme subject to the inclusion for the Committee’s December meeting of the WAO Performance Work Programme update.

 

ADDITIONAL ACTION PROPOSED: Internal Audit Manager to update the Forward Work Programme accordingly.

 

10.

Exclusion of Press and Public pdf icon PDF 148 KB

“Under Section 100 (A) (4) of the Local Government Act 1972, to exclude the press and public from the meeting during the discussion on the following item on the grounds that it may involve the disclosure of exempt information as defined in Schedule 12A of the said Act and in the attached Public Interest Test.”

 

Minutes:

It was resolved to adopt the following provision in considering item 11 on the agenda:

 

“Under Section 100 (A) (4) of the Local Government Act 1972, to exclude the press and public from the meeting during the discussion on the following item on the grounds that it involved the disclosure of exempt information as defined in Schedule 12A of the said Act and in the attached Public Interest Test.”

11.

Changes to Council Tax Relief Scheme Investigation Arrangements

To present the report of the Head of Function (Resources) and Section 151 Officer.

Minutes:

The report of the Head of Function (Resources) and Section 151 Officer setting out operational changes to the investigation of Council Tax Relief Scheme fraud was presented for the Committee’s consideration. The report outlined the background as regards the changes that followed the transfer of responsibility for the investigation of all benefit fraud from the Council to the Department of Work and Pensions Single Investigation Service in November, 2014 and the arrangements the Council made thereafter to continue to investigate Council Tax Reduction Scheme fraud offences (as this was not classed as a benefit) and other Council Tax offences. A retirement provided an opportunity to review arrangements following which it was decided to delete the retiree’s post; the report outlines the resulting operational changes that were made to continue with the work in relation to the Council Tax Referral Scheme fraud; the National Fraud Initiative and other fraud investigations.

 

It was resolved to note the operational changes to the investigation of Council Tax Relief fraud and the deletion of a relevant post within Internal Audit.

12.

Exclusion of Press and Public pdf icon PDF 119 KB

“Under Section 100 (A) (4) of the Local Government Act 1972, to exclude the press and public from the meeting during the discussion on the following item on the grounds that it may involve the disclosure of exempt information as defined in Schedule 12A of the said Act and in the attached Public Interest Test.”

 

Minutes:

It was resolved to adopt the following provision in considering item 13 on the agenda:

 

“Under Section 100 (A) (4) of the Local Government Act 1972, to exclude the press and public from the meeting during the discussion on the following item on the grounds that it involved the disclosure of exempt information as defined in Schedule 12A of the said Act and in the attached Public Interest Test.”

13.

Corporate Risk Register

To present the report of the Insurance and Risk Manager.

Minutes:

The report of the Head of Function (Resources) and Section 151 Officer incorporating the Corporate Risk Register as reviewed and updated to the end of Quarter 1 2017/18 by the Senior Leadership Team was presented for the Committee’s consideration.

 

The Insurance and Risk Manager reported on the following matters –

 

           The top (red) risks to the Council

           Risks that have fallen out of the Register

           Risks that have been de-escalated in the period since the last report to the Committee in December, 2016 as the residual risk is now deemed to be less than it was when last reported

           Risks newly identified and included within the Corporate Risk Register and the reasons for their inclusion therein.

 

The Committee noted the information and sought clarification of certain aspects in relation to the timeframe for implementing mitigating actions as regards specific risks, and the rationale for actions that are aimed at reducing the impact of some risks rather than the likelihood of their occurring.

 

It was resolved to note the report and that the Committee takes assurance that the risks to the Council’s aims and objectives are being recognised and managed by the Senior Leadership Team.

 

NO ADDITIONAL ACTION WAS PROPOSED