Agenda and minutes

Councillor George Cooper declared a Non-Pecuniary interest in Agenda Item 7 – Internal Audit Progress Report and Plan amendments as his wife was a Governor of one of the schools in the report. He remained in the room and took part in discussions on the item. 

Agreed as an accurate record.

[The Chairman reported that the final version of the Annual Audit letter had been circulated to the Members before submission to the Audit Commission.]

To confirm that all items marked Part I will be considered in public and that any items marked Part II will be considered in private.

It was agreed that all items of business would be considered in public.

Members were reminded that the first Corporate Fraud Plan was approved by the Audit Committee in June 2012 and it was reported that progress against that plan was mostly on track.

Particular reference was made to the activity of Social Housing Fraud where 28 properties had been taken back by the Council which had generated savings of £504,000. The Committee praised officers for their work in this area.

Reference was made to the Protecting the Public Purse checklist which was a process which reviewed counter-fraud arrangements, and the high degree of compliance the Council had with this.

Members expressed some concern regarding the comments on Procurement which referred to extensive work which was taking place to tighten controls in on construction work. The Director of Finance reported that Contract Standing Orders had been updated which tightened controls in this area.

The Committee asked that an update on Procurement be given to the June meeting to give Members assurance that procurement controls were working.

Reference was made to the Whistle-blowing policy which was to be updated by the Council’s Monitoring Officer before the end of the financial year.

The Committee noted the significant progress which had been made in relation to the introduction of proper safeguarding proportionate to risk, in the use of personal budgets for adult social care, in particular direct payments.

RESOLVED -    

1. That the contents of the report be noted.

Members were informed that the Annual Treasury Management Strategy was agreed by Full Council as part of the budget setting process in February. However, a draft of the strategy was brought before this Committee to enable greater scrutiny.

The Director of Finance informed Members that, when considering the Council’s investment opportunities, consideration was given to advice from Arlingclose, the Council’s Treasury advisors.

Reference was made to paragraph 2.6 of the report which referred to the average rate of interest paid on Council lending, which was very low but was based on this Council’s cautious strategy of only investing in highly rated UK banks. Reference was made to Government backed guarantees as an option for investment and the Director of Finance said he would investigate this as part of the Council’s Investment Strategy.

The Committee noted that the Cumulative Net Borrowing Requirement for 2012/13 had dropped substantially: this was largely because of the HRA settlement.

The Director of Finance reported that the contents of Table 14 on Specified Investments would be updated prior to submission to February Council, with a view to reducing the list to those investments likely to be used. In addition in relation to Non-Specified Investments, , the Director of Finance said he would also investigate further Sterling denominated bonds by non-UK sovereign governments.    

RESOLVED –

1. That the Committee reviewed and noted the information contained in the report.

The Head of Audit provided Members with a summary of Internal Audit activity in the period from 1 September 2012 to 22 November 2012.

During the period four completed audits in the current report had received Limited Assurance, six had received Satisfactory Assurance and three Full Assurance.

The Committee noted that the recruitment for a trainee auditor had been completed and the appointee would commence duties in January 2013.  This vacancy had arisen because a trainee auditor had resigned.

The following issues were raised by Members:

·        Contracts – Final Accounts (Corporate Construction) (2011-12) – the Committee expressed concern at the number of high risk actions from this audit. The Head of Audit recognised this but reported that these were currently being addressed and would be included in the update report which the Committee would receive in June.

·        Direct Payments 2011/12 review – the objective of this audit was to provide assurance to management on the adequacy, effectiveness and application of the key controls in relation to those service users in receipt of Direct Payments. The Head of Audit reported that since the audit had been conducted a significant amount of progress had been made in addressing the identified risks. An update on progress made would be submitted to the next meeting.

·        Golf Courses Audit – Members expressed some concern regarding the number of high risk actions. The Director of Finance reported that the Golf Courses had been previously managed by a contractor and the Council had taken control less than a year ago. The Head of Audit reported that officers were currently working through the recommendations to the agreed timelines. The Committee asked that the appropriate Management representative be invited to the next meeting of the Committee to update Members on progress.

·        Creditors – The Committee was assured that the two high risk areas had now been addressed.

·        Hillingdon Grid for Learning – The Committee noted the progress which had been made on addressing the previous risk areas.

·        Emergency Duty Team – The Committee noted that this audit had now received full assurance level.

The Members questioned whether the increase in high risk actions identified in audits may indicate a possible reduction in internal control.  The Head of Audit reported that the Council had undergone many structural changes which had impacted on some of the audit areas but Internal Audit were trying to ensure control was maintained in these areas.

Discussion took place on Follow Up audits and the following points were made :

·        Investigation 30 – the Head of Audit reported that no progress had been made

·        Carbon Reduction Commitment CRC – Members were informed that this was hoped to have been implemented by November. An update would be given to Members

·        IT Security & Data Handling in Schools– the Head of Audit had followed this up with the Chief Education Officer and would update Members.

·        Food Health & Safety 1st Follow Up – the Head of Audit reported that good progress was being made on outstanding recommendations

·        Fusion Contract Management  ...  view the full minutes text for item 32.

Noted.

The Committee agreed that the annual review in Internal Audit should take the form of a self assessment carried out by the Head of Audit.

Audit Commission document: ‘Protecting the Public Purse’

The link to this document was emailed out to Members of the Audit Committee on 9 November 2012.

Audit Commission Document – Protecting the Public Purse – Members noted the document which had been sent to them on 9 November 2012

Corporate Services & Partnerships Policy Overview Committee review into the Effectiveness of the Audit Committee and its Terms of Reference – Members asked for a progress report on this for the next meeting.