Agenda and minutes

There were no apologies of interest.

Councillor Tony Eginton declared a non-pecuniary interest arising from the fact that he was a retired member of the Local Government Pension Scheme. He remained for the discussion of all items.

Councillors Scott Seaman-Digby and Susan O'Brien, both declared non-pecuniary interests arising from the fact that they were deferred members of the Local Government Pension Scheme. They also remained for the discussion of all items.

It was agreed that all the items on the agenda be considered in public with the exception of Agenda Item 11 2017/18 Quarter 4 Corporate Risk Register.

RESOLVED –

1.    That the minutes from the meeting on 11 April 2018 be approved as an accurate record.

2.    That the minutes from 10 May 2018 be approved subject to recording apologies from Councillor Tony Eginton.

The Committee was provided with reports which summarised the findings of Ernst Young (EY), the External Auditor, on the audit of the 2016/17 Statement of Accounts, including the Pension Fund Accounts. The reports summarised the Council's main financial statements and the Pension Fund accounts audit.

The Committee was informed that based on the work undertaken to date, EY anticipated issuing an unqualified opinion on the Council's financial statements, subject to the completion of outstanding work.

The Committee was provided with details of Key Audit risks that were identified prior to audit and reported to Audit Committee on 11 April 2018.

It was reported that EY had substantially completed their audit of London Borough of Hillingdon's financial statement for the year ended 31 March 2018 and had performed the procedures outlined in the Audit plan.

The statement of accounts was inclusive of the Pension Fund accounts, however, the Pension Fund accounts were audited separately due to the specialist nature. Subject to completion of the outstanding areas, the auditor had indicated that this part of the Financial Statements would receive an unqualified opinion.

During Member discussions, it was noted that the Internal Audit and EY had a good working relationship where there was regular contact. Both teams kept each other up to date about work plans. Further information in relation to intangible assets would be provided

RESOLVED -

1.    That the Audit Committee approved the audited Statement of Accounts for 2017/18.

The Committee had regard to the Annual Internal Audit Report and Opinion Statement 2017/18.

The Head of Business Assurance reported that despite a reduction in Intenral Audit capacity the 2017/18 Intenral Audit plan was c90% complete to draft stage report by stage 31 March 2018 and 98%  complete to final report stage by 30 June 2018.

Members commented that it was an interested report and congratulated officers for their work.

Following member questions, the Head of Business Assurance provided further information red status KPIs in a Review Of Internal Audit Performance 2017/18. It was explained that in relation to KPI 4 (49% red), managers were given three weeks to respond which was a reasonable time. If recommendations were more complicated it may be due to consulting with senior colleagues which can impacted action. It was explained that in relation to KPI 7 – 57% of draft reports issued was a final report within 15 workings days this could be managers if areas were of concerns were informed prior to the report being drafted to put managers on notice of key issues. Generally managers had realistic timescales and were accountable.

RESOLVED – That the contents of the Annual Internal Annual Report and Opinion Statement 2017/18 be noted.  

The Senior Internal Audit Manager presented the report which provided summary information on all Internal Audit work covered in relation to the 2018/19 Quarter 1, together with assurance levels in this respect.

The Committee was informed that for 2018/19 Quarter 1, one assurance review had concluded, one consultancy review had been finalised,  one grant claim had been certified and nine pieces of 2017/18 work had been finalised. The planned Internal Audit consultancy review of CYPS Thematic Revie Ofsted preparations was also concluded. The Council has also recently been tasked with identifying at least 450 turned around families for the August 2018 submission. Internal Audit was liaising closely with officers given the tight timescale and backdrop of the current reduction in Internal Audit resource.

It was noted that the Internal Audit was operating at a reduced capacity which impacted the number of reviews. There was an recruitment plan in place. There had also been a recent restructure which saw the team being reduced to the Head of Business Assurance and a team of seven from eight. This took the place of a trainee apprentice, which meant that funding could be used to revaluate the pay of other officers. It was reported was that the main issue was members of staff leaving Hillingdon to go to other Boroughs where staff were paid more. Two new role of a senior internal audit and professional internal auditor was due to be advertised at high banding salaries. It was hoped that this would attract more candidate with the relevant skills set. There was also an action plan of using Mezars and obtain seconders form there to fill the gaps in the interim. Hillingdon were keen to keep services in house.

Members requested further information or a matrix on the head count of staff and projected completed. Members attention was drawn to the Annual Internal Audit Report and Opinion Statement 2017/18, in which it was reported that 34 assurance reviews were undertaken in 2014/15, 33 in 2015’/16, 30 in 2016/17 and 25 in 2017/18.

Members questioned the delay in the introduction of universal credit. It was clarified that it had already been introduced in two postal area, one area due to go live in September 2018. There had been a dispute about whether one postal area belong to Uxbridge, and Internal Audit had been requested to come in in early August when the team was in a stronger and better position.

Since the report was drafted two further assurance reviews had concluded. In  relation to early years centres a 'No' assurance was given by Internal Audit. The high priority issues were:  a lack of procedural docs;Issues with the registration forms and contracts; and The administration of contracted sessions. The details concerning this audit would be presented in 2018/19 Q2 Progress Report to the Audit Committee.

RESOLVED –

1.   That the Internal Audit progress report for 2018/19 Quarter 1 be noted and approval be given to the Quarter 2 Internal Audit Plan for 2018/19.  ...  view the full minutes text for item 8.

The Committee was provided with a report which gave details on the work being undertaken by the Business Assurance Counter Fraud Team (BACFT) in relation to 2018/19 Quarter 4 and assurances in this respect. The Counter Fraud Manager provided an oral summary of the report.

It was reported the major restructure had now been complete with all permanent posts recruited to and all new members of staff in place. There were 17 members of staff in place and the new structure would help to ensure that the team had the right mix of skills, qualifications and experience to meet the changing needs of the Council. The Home Office Immigration Enforcement Officer joined the Council in April 2018 and positive results have already been seen in terms of loss prevention.

Other key points reported included more engagement work with managers around the Council being undertaken. In terms of housing tenancy fraud cases, seven properties had been recovered to the Council. Three cases of fraudulent right to buy applications (RTB) had been identified. There had also been a prosecution in the Crown Court of a fraudulent RTB application where a suspended sentence and community service was issued along with costs being rewarded to the Council. Further details of this would be provided in the next quarter report.

A proactive Blue Badge misuse operation was carried out in Uxbridge with eight parking contraventions notices being issued, three blue badges being seized for misuse and three criminal investigations being opened following badge seizures.

Three cases had been identified to discontinue funding for section 17 emergency accommodation and two cases of prevention of first time buyer scheme fraud resulted in a savings of approximately £36,000.

Key performance indicators were also reported to the Committee. Although they were not being met as well as expected, areas of shortcomings were being addressed.

Members were informed that figures against the total number of tenancies in the Borough could be provided to the Committee.

RESOLVED – That the Counter Fraud Progress Report for 2018/19 Quarter 1 be noted.

Members were asked to review the draft skills matrix and make any amendments. Members were informed that once the draft skills matrix was approved, it would be sent to them to complete on a confidential basis. Relevant training sessions would then be arranged in consultation with other teams across the Council.

RESOLVED – That the draft Member skills matrix be approved.

RESOLVED – That the forward work programme be noted.

This item was discussed as a Part II item without the press or public present as the information under discussion contained confidential or exempt information as defined by law in the Local Government (Access to Information) Act 1985.  This was because it discussed ‘information relating to the financial or business affairs of any particular person (including the authority holding that information)’ (paragraph 3 of the schedule to the Act).

The report presented to Members the Corporate Risk Register for Quarter 4 (January 2018 – March 2018). The report provided evidence about how identified corporate risks were being managed and the actions which were being taken to mitigate against those risks.

RESOLVED –

That the Committee reviewed the Corporate Risk Register for Quarter 4 (January – March 2018), as part of the Committee's role to independently assure the risk management arrangements in the Council.