Agenda and minutes

59/21 – APOLOGIES FOR ABSENCE AND NOTIFICATION OF SUBSTITUTES:

Notification had been received that Councillor Victoria Oldham was to act as substitute for Councillor Steven Jackson and Councillor Paul Haslam was to act as substitute for Councillor Alex Raubitschek.

(5.31 pm)

Member to advise of any declarations of interest.

60/21 – DECLARATIONS OF INTEREST: No declarations of interest were made at the meeting.

(5.32 pm)

of the meeting of 12 January 2022.

61/21 – MINUTES: The Minutes of the meeting of the Committee held on 12 January 2022 were approved as a correct record.

(Four Members voted for the motion and there was one abstention.)

(5.33 pm)

To determine whether to exclude the press and public during the consideration of any exempt information items – item 8 (part).

62/21 – EXEMPT INFORMATION: Appendices 1, 1b and 2 of the item considered at Minute 66/21 were considered exempt under paragraph 3 of schedule 12A of the Local Government Act 1972 as they contained information relating to the financial or business affairs of any particular person (including the authority holding that information). It was not necessary to discuss the exempt information and the item was discussed in open session.

(5.33 pm)

To consider any questions under Standing Order 27.

63/21 – PUBLIC ARRANGMENTS - QUESTIONS: There were no public questions to consider under Standing Order 27.

(5.34 pm)

The External Auditors (Mazars LLP) to submit a written report.

64/21 – EXTERNAL AUDIT COMPLETION REPORT: The Chair welcomed Diane Harold, the Senior Manager of Mazars LLP, the Council’s external auditor, to present the External Audit Completion Report for the year ended 31 March 2021. Further to Minute 55/21, the Committee were asked to note the contents of the formal report which was to be signed off within the next two weeks.

Ms Harold summarised that the proposed audit opinion was an unqualified opinion, without modification, on the financial statements. It was highlighted that the audit opinion usually included a certificate which had been delayed this year for all authorities in the country as a result of delays in respect of the Whole Government Accounts. The completed audit concluded that there were no matters to report in respect of the value for money arrangements and no use of the auditor’s wider powers under the 2014 Act had been required. Ms Harold reported that several audit areas that were outstanding at the time of issuing the report had since been completed, including the Covid-19 grant income work, as set out in section 2 of the report.

The significant findings that had been discussed with the Council’s management, as outlined in section 4 of the report, included pensions, controls in place over journals and the calculation of the impairment of debtors allowance. Additional work was undertaken in respect of controls in place to ensure income and expenditure was included in the correct year in order to ensure that there was no material misstatement.

Mazars LLP had provided internal control recommendations that were ranked as high, medium and low. The External Audit Completion Report identified two high priority issues, three medium priority issues and there were no low priority issues. The first high priority recommendation concerned property, plant and equipment and investment property valuations. Whilst it was reported that there were various adjustments, overall amendment to the accounts was not required for these misstatements, on the grounds of materiality. The second high priority recommendation detailed arrangements in place for the production and audit of the statutory financial statements, including the Annual Governance Statement. Ms Harold explained that the failure to meet the statutory deadline for the completion of the financial documents was due to a slippage on the audit for the year ended 31 March 2021 as a result of the cumulative impact of the pandemic as well as other pressures within the Council. The continued co-operation between Mazars and the Council’s management team during the audit was thoroughly emphasised. A follow-up on previous internal control points was also detailed in the External Audit Completion Report.

The summary of misstatements which were identified during the course of the audit were set out in section 6 of the report. Ms Harold explained that the key point to note was that there were no material unadjusted misstatements.

Appendix A set out the draft management letter of representation and Appendix B detailed the draft audit report. Appendix C outlined that there were no independence issues to  ...  view the full minutes text for item 64.

The Audit Services and Fraud Manager to submit a written report.

65/21 – AUDIT SERVICES MARCH MONITORING REPORT: The Audit Services and Fraud Manager submitted a written report which outlined internal audit activity for the period of 1 April 2021 to 1 March 2022. The report was presented by the Auditor and contained details of work undertaken and a summary of all completed reviews along with the overall audit opinion. The breakdown of the current position for the year 2021/22 as of 1 March 2022 was outlined at paragraph 5.3 of the report and the key points to note were summarised at paragraph 5.4.

The Auditor explained that since the publication of the monitoring report one further audit had been issued in draft, namely the HCC rostering report. The predominant focus of the work undertaken by audit services was the pre-payment assurance works for the Covid-19 grants which included the Omicron hospitality leisure grants and the additional restriction grants. Following the completion of this work within the next few weeks the audit plan would be completed. It was highlighted that several service areas were under increasing resource pressures due to ongoing Local Government Reorganisation (LGR) work but that due to strong working relationships and the project work that had been undertaken, this would not adversely affect the overall assurance level.

In response to questions from Members, the Auditor confirmed that the postponed audits outlined in the table set out at paragraph 5.3 of the report were intended to be completed and reported back on to the Committee within the 2022/23 financial year. In response to another question regarding staffing levels in light of LGR work, it was confirmed that audit services were working with Veritau, the NYCC and York City Council auditing company, enabling audit services to complete the substantial work that was required of them.

Councillor Paul Haslam noted that there was clearly pressure on the service and the potential risk from this and highlighted that the Committee supported the Officers and appreciated the hard work that they were required to undertake.

RESOLVED (UNANIMOUSLY):

That the contents of the report are noted.

(5:47 pm – 5:53 pm)

(D)

The Audit Services and Fraud Manager to submit a written report.

66/21 – INTERNAL AUDIT RECOMMENDATION REPORT: The Audit Services and Fraud Manager submitted a written report which was presented by the Auditor and provided an update of the current audit recommendation implementation position. Exempt Appendix 1 contained a detailed report of outstanding priority one recommendations and exempt Appendix 1b contained information on aged priority two and three recommendations. Exempt Appendix 2 summarised the internal audit recommendations completed in the period whilst Appendix 3 provided a summary of other outstanding audit recommendations. The Auditor reported that nine audit recommendations had been completed and fully implemented and that a further 14 recommendations remained outstanding and were reliant on the completion of various projects to which the audit service were currently involved in.

In response to questions from Members, the Auditor clarified that the outstanding priority one audit recommendations attached at Exempt Appendix 1 were in progress but were reliant on the completion of a large project which involved work from multiple service areas.

RESOLVED (UNANIMOUSLY):  

That the contents of the report and appendices are noted.

Appendix 1 – Outstanding Priority One Internal Audit Recommendations

Appendix 1b – Outstanding Priority Two and Three Audit Recommendations

Appendix 2 – Internal Audit Recommendation Movements in the Period

Appendix 3 – Summary of All Outstanding Internal Audit Recommendations

(5:53 pm – 5:58 pm)

(D)

The Financial Services Manager to submit a written report.

67/21 – AUDITED STATEMENT OF ACCOUNTS 2020/21: The Financial Services Manager (FSM) submitted a written report which set out the Council’s statutory Audited Statement of Accounts for the year ended 31 March 2021 for approval. Approval of the Audited Statement of Accounts was considered each year alongside the Audit Completion Report from the Council’s external auditors and the Annual Governance Statement.

Further to Minute 43/21, the draft Unaudited Statement of Accounts for 2020/21 was presented to the Committee on 22 November 2021 and the accounts had since been subject to audit and several amendments had been made, as detailed in the External Audit Completion Report at Minute 64/21. The updated Statement of Accounts was attached at Appendix 1 to the report. There had been a delay in bringing forward the documents for the 2020/21 year, which were scheduled for sign off by 30 September 2021. The FSM highlighted that only 9% of local authorities had met this deadline. It was noted that the support and assistance that had been provided by the Council’s external auditors was greatly appreciated by all involved. If approved by the Committee, the Audited Statement of Accounts 2020/21 were to be signed and dated by the Chair of the Audit and Governance Committee however in the absence of the Chair and Vice-Chair, the documents would be signed by the appointed Chair for the meeting, Councillor Victoria Oldham.

RESOLVED (UNANIMOUSLY):  

That (1) the audited version of the Statement of Accounts is approved; and

        (2) the Chair of the Audit and Governance Committee signs and dates the Statement of Accounts to confirm their approval by the Committee.

    (5:58 pm – 6:00 pm)

                                 (D)

The Scrutiny, Governance and Risk Manager to submit a written report.

68/21 – ANNUAL GOVERNANCE STATEMENT 2020/21: The Scrutiny, Governance and Risk Manager (SGRM) submitted a written report which outlined the detail supporting the Annual Governance Statement (AGS) 2020/21. The Accounts and Audit (England) Regulations 2015 require all relevant bodies to prepare an AGS to append to their Statement of Accounts. The AGS set out the Council’s governance arrangements and reviewed how the Council had complied with its Code of Corporate Governance for the 2020/21 year.

The review for the AGS sought to test annual compliance with the Code of Corporate Governance and identified three significant governance issues which were outlined at paragraph 5.12 of the report. The SGRM explained that progress against these issues would be monitored and reported on to the Committee in 2022/23. The Governance Improvement Action Plan formed part of the AGS and detailed continuous improvement actions identified by the review.

RESOLVED (UNANIMOUSLY):   

That the Audit and Governance Committee reviews the Annual Governance Statement 2020/21 and agrees that:

(1)  It is properly supported by evidence;

(2)  It fairly reflects the Council’s corporate governance arrangements; and

(3) It is recommended for approval by the Leader of the Council and the Chief Executive and is signed by the Chairman.

     (6:00 pm – 6:03 pm)

 (D)