Agenda and minutes

Audit and Governance Committee
Thursday, 28th September, 2017 2.00 pm

Venue: Committee Suite 1,2 & 3, Westfields, Middlewich Road, Sandbach CW11 1HZ. View directions

Contact: Gaynor Hawthornthwaite  Democratic Services Officer

Link: audio recording

Items
No. Item

13.

Apologies for Absence

Minutes:

There were no apologies received.

 

14.

Declarations of Interest

To provide an opportunity for Members and Officers to declare any disclosable pecuniary and non-pecuniary interests in any item on the agenda.

Minutes:

 There were no declarations of interest. 

 

15.

Public Speaking Time/Open Session

In accordance with Procedure Rules Nos.11 and 35 a total period of 10 minutes is allocated for members of the public to address the Committee on any matter relevant to the work of the body in question.

 

Individual members of the public may speak for up to 5 minutes but the Chairman will decide how the period of time allocated for public speaking will be apportioned where there are a number of speakers.

 

Members of the public wishing to ask a question at the meeting should provide at least three clear working days’ notice in writing and should include the question with that notice. This will enable an informed answer to be given.

It is not required to give notice of the intention to make use of public speaking provision, however, as a matter of courtesy, a period of 24 hours notice is encouraged.

Minutes:

Councillor D Marren addressed the Committee on issues relating to governance and non-compliance.  He referred to the non-payment of the minimum wage to sleep-in staff and the Council’s report on Whistleblowing items and procedures.

 

16.

Minutes of Previous meeting pdf icon PDF 80 KB

To approve the minutes of the meeting held on 1st June 2017 as a correct record.

Minutes:

That the minutes of the meeting held on 1st June 2017 be approved as a correct record.

 

17.

Grant Thornton - Audit Findings and Action Plan Report 2016/17 pdf icon PDF 95 KB

To consider the report of Grant Thornton, the external auditors, on their findings from the 2016/17 audit

Additional documents:

Minutes:

Grant Thornton presented the Audit Findings report on the 2016/17 Audit which had been prepared in accordance with the requirements of the International Standard on Auditing (UK and Ireland) 260, the Local Audit and Accountability Act 2014 and the Audit Office Code of Practice.

 

The report identified key issues considered by Grant Thornton on the Council’s financial statements and its arrangements for securing economy, efficiency and effectiveness in the use of resources.  The Auditors highlighted the key headlines including the audit adjustments and the Annual Governance Statement.

 

It was reported that some changes are to be made to the final statement to reflect the current position, value for money, audit and audit certificate.  Due to a number of pending issues, there has been a delay in certification of completion of the audit for the year ended 31 March 2017.

 

RESOLVED

 

That:

 

a)    the Audit Findings Report for 2016/17 be received; and .

 

b)    the letter of representation be signed by the Director of Finance and Procurement.

 

18.

2016/17 Statement of Accounts pdf icon PDF 89 KB

To consider the report and note the changes to the draft accounts in accordance with the audit findings report.

Minutes:

Consideration was given to the 2016/17 Statement of Accounts for Cheshire East Council and the Cheshire East Group which provided information on the financial assets and transactions of the Group.

 

The report detailed amendments to the statement of accounts; specifically the main change affecting the Council’s Comprehensive Income and Expenditure Statement (CIES) relating to the underlying accounting treatment of reserves and some internal recharges. The overall deficit on provision of services remains unchanged.

 

 

RESOLVED

 

That:

 

1.    the report be received and the changes to the draft accounts be noted in accordance with the Audit Findings Report; and

 

2.    delegated authority be granted to the Chairman of the Audit and Governance Committee to sign off the final accounts on behalf of the Committee.

 

19.

Treasury Management Annual Report 2016/17 pdf icon PDF 104 KB

To consider a report on the performance of the Council’s treasury management operation for 2016/17.

Additional documents:

Minutes:

Consideration was given to the report which had been considered by Cabinet at its meeting on 13th June 2017. 

 

It was noted that the Council had complied with its legislative and regulatory requirements and had remained within all of its prudential indicators during the year as detailed in Annex 1.

 

Information was provided on financial activities during the 2016/2017 financial year including investments, cash flows, capital expenditure, external borrowing, banking and property funds.  

 

In answer to Members questions about borrowing and investing, the Committee was advised that the Treasury Management strategy is to work on the basis of  maximising investment opportunities and minimising borrowing requirements.

 

 

RESOLVED

 

That the Treasury Management Annual Report for 2016/17, set out in Appendix A of the report, be noted.

 

20.

Update on Air Quality Data Internal Audit Report pdf icon PDF 101 KB

To consider a report which details the management actions agreed following the Internal Audit review of Air Quality Management.

Additional documents:

Minutes:

Consideration was given to the report which summarised details of the management actions agreed following the Internal Audit review of Air Quality Management.

 

It was noted that during the preparation of the Air Quality Annual Status Report (ASR) for submission in 2016, anomalies were discovered by management, between the data recorded on the Council’s systems and the source data provided by the laboratory that analyses the monitoring equipment. Initial analysis identified multiple anomalies in the 2016 figures, and also in those used to complete the previous return. The Chief Executive then requested that Internal Audit carry out a review of data returns, and the processes in place for the monitoring, recording and dissemination of air quality data.

 

Internal Audit carried out a review of the policies, systems and procedures in place to provide assurance that the key risks are being managed effectively.

 

RESOLVED

 

That:

 

1.    the management actions agreed following the review be noted; and

 

2.    an update on progress in implementation be provided as part of the interim report by Internal Audit at the December 2017 meeting, be noted.

21.

Annual Governance Statement 2016/17 pdf icon PDF 77 KB

To approve the Annual Governance Statement for 2016/17.

Additional documents:

Minutes:

At its meeting on 1st June 2017 the Committee had considered the draft Annual Governance Statement (AGS) which had now been amended to take account of feedback received at the meeting and subsequently from Members and the External Auditors.  Once finalised, the AGS will be published on the Council’s website, along with the Statement of Accounts.

 

The purpose of the AGS process was to provide a continuous review of the organisation’s governance arrangements so as to give assurance on the effectiveness on the processes and/or address identified weaknesses in order to support the continuous improvement of the Authority.

 

Members received and noted the updates to the Proposed Final Annual Governance Statement 2016/17 -  Section 7 – Significant Governance Issues arising in 2016/17.

 

RESOLVED

 

That approval be given to the 2016/17 Annual Governance Statement.

 

 

 

 

 

 

22.

Audit and Governance Committee Annual Report 2016/2017 pdf icon PDF 87 KB

To consider the Committee’s draft annual report for 2016/17 prior to it being considered at the Council meeting on 19th October 2017.

Additional documents:

Minutes:

Consideration was given to the draft report of the Chairman of the Committee on its performance and effectiveness in 2016/17 with regard to its terms of reference and purpose. 

 

The report provided details of work undertaken by the Committee and the assurances received during the year.

 

RESOLVED

 

That the draft Annual Report for 2016/17 be approved, for consideration by the Council at its meeting on 19 October 2017, subject to the following corrections:

 

·         Page 101: Previous member of the Audit and Governance Committee -  Councillor James Nicholas from February 2017 May 2017 to be added.

·         Page 89 – Head of Internal Audit (post currently vacant) and one member of staff short - short term measures are currently in place.  

·         Page 90 – Paragraph on the External Auditor’s opinion on the Financial Statements to be re-written

·         Some spelling corrections.

 

 

23.

Report on Customer Feedback - Complaints, Compliments and Referrals to Local Government Ombudsman 2016/17 pdf icon PDF 220 KB

To consider a report on the complaints, compliments and referrals to the Local Government Ombudsman for 2016/17.

Minutes:

Consideration was given to the report which summarised the formal feedback received from customers during 2016/17, together with a summary of the cases dealt with by the Local Government Ombudsman (LGO).

 

Details were given of the feedback received, broken down into compliments (1503), suggestions (148) and complaints (1603) as follows:

 

·         The number of complaints had increased marginally from the previous year – 1603 in 2016/17 compared with 1565 in 2015/16.  The increase was partly attributable to 112 complaints made to the Licensing Team as a result of a campaign by a third party, relating to the changes to the Hackney Carriage table of fares; interested parties were encouraged to submit complaints with a view to seeking recompense.  None of these complaints were upheld.

 

·         The number of recorded compliments was 1503, compared with 1855 in 2015/16 which related to Adult Services. 

 

·         The recorded suggestions (148 compared to 177 in 2015/16) were neither complaints nor compliments, but often suggested changes to policy or working practice.

 

·         Whilst not formally recorded on the corporate feedback system, complaints from MP’s on behalf of their constituents had reduced significantly (18 to 30) from 2015/16.  

 

With regard to complaints all customers were offered the opportunity to appeal to the Local Government Ombudsman and the report included details on the decision notices issued to the Council.

 

           

RESOLVED

 

That the report be noted.  

 

24.

Members' Code of Conduct: Standards Report pdf icon PDF 63 KB

To consider a report on the number of complaints received under the code of conduct for Members which have been, or are to be considered by the Acting Director of Legal Services (in his capacity as the authority’s Monitoring Officer) and the Independent Person for the period 1 March 2017 to 31 August 2017.

Minutes:

The Committee was advised of the number of complaints received under the Code of Conduct for Members which had been considered by the Acting Director of Legal Services (in his capacity as the authority’s Monitoring Officer) and the Independent Person, during the period from 1 March 2017 to 31 August 2017.

 

The report broke down complaints received with regard to the number of complaints made against Cheshire East Councillors and Town and Parish Councillors; the paragraph of the code alleged to have been breached and the outcome of each complaint, where completed.

 

RESOLVED

 

That the report be noted.

 

25.

Whistleblowing Arrangements pdf icon PDF 284 KB

To consider a report on the number of 2016/17 reports and an update on a forthcoming independent review of the Council’s whistleblowing arrangements.

Minutes:

Consideration was given to a report which outlined a breakdown of the number of reports received during 2016/17 and an update on a forthcoming independent review of the Council’s whistleblowing arrangements.

 

Details were given on the reports received during 2016/17, broken down as follows:

 

·         6 did not fall under the scope of the policy and were therefore referred to the appropriate service/organisation for action;

·         2 were unsubstantiated following investigation;

·         1 was referred to Environmental Health for further investigation;

·         1 was upheld following investigation and appropriate remedial action taken;

·         2 where it was not possible to conclude the investigation as the officer concerned left the Council; and

·         1 referral is still subject to an ongoing investigation.

 

Appropriate remedial action will be taken to address any control weaknesses identified during this process.

 

This represents an 18.75% decrease in the total number of referrals when compared to those received in 2015/16. However, the previous figures were particularly high as they included 7 referrals relating to the same procurement issue, and, when these are discounted, the year on year figures are consistent.

 

With regard to the review of whistleblowing arrangements, details on the level of support that is to be provided to Cheshire East Council were highlighted. 

It was reported that a full desk based review of current policy, procedures and supporting documents, is to be benchmarked against the Whistleblowing Commission's Code of Practice and a RAG rated report with recommendations and an action plan for improvement is to be provided.

This will be supported by a full communications plan, and is expected to go live early October.

 

RESOLVED

 

That the report be noted and the external review of the Council’s whistleblowing arrangements be endorsed.

 

 

26.

Review of the Effectiveness of Internal Audit and Compliance with the Public Sector Internal Audit Standards pdf icon PDF 78 KB

To consider a report which provides an update on the Independent Public Sector Internal Audit Standards external assessment, scheduled to take place later in 2017/18.

Additional documents:

Minutes:

Consideration was given to a report which provided an update in relation to the independent Public Sector Internal Audit Standards (PSIAS) external assessment, which is scheduled to take place late 2017/2018.  It is a requirement of an organisation’s internal audit function that an external assessment be carried out once every five years by a qualified, independent assessor or assessment team from outside of the organisation.

 

The appendix to the report detailed the Peer Review – Memorandum of Understanding.

 

RESOLVED

 

That the forthcoming external assessment of Internal Audit against PSIAS and its scope be noted and that the Chief Executive be appointed as sponsor of the assessment.

 

27.

Work Plan 2017/18 pdf icon PDF 115 KB

To consider the Committee Work Plan and any required amendments.

Additional documents:

Minutes:

Consideration was given to the Committee’s Work Plan. It was noted that unallocated items are to be reported back to the Committee as and when appropriate. 

 

RESOLVED

 

That:

 

·         the Work Plan be received and noted; and

·         the Work Plan be brought back to the Committee throughout the year for further development and approval.

 

 

 

28.

Waivers and Non Adherences pdf icon PDF 70 KB

To receive an update on the quantity and reasons for the issue of WARNs approved between the 1st of February 2017 and the 31st of August 2017.

Minutes:

The Committee considered a report on the quantity and reasons for Waiver and Non Adherences (WARNs) approved between 1 February 2017 and 31 August 2017.  The report also presented the approved WARNs for review.

 

RESOLVED

 

That the report be noted.

 

29.

Exclusion of the Press and Public

The reports relating to the remaining items on the agenda have been withheld from public circulation and deposit pursuant to Section 100(B)(2) of the Local Government Act 1972 on the grounds that the matters may be determined with the press and public excluded.

 

The Committee may decide that the press and public be excluded from the meeting during consideration of the following items pursuant to Section 100(A)4 of the Local Government Act 1972 on the grounds that they involve the likely disclosure of exempt information as defined in Paragraphs 1, 2 and 3 of Part 1 of Schedule 12A to the Local Government Act 1972 and public interest would not be served in publishing the information.

 

Minutes:

That the press and public be excluded from the meeting during consideration of the following item pursuant to Section 100(A)4 of the Local Government Act 1972 on the grounds that it involves the likely disclosure of exempt information as defined in Paragraphs 1 2 and 3 of Part 1 of Schedule 12A to the Local Government Act 1972 and public interest would not be served in publishing the information.

 

30.

Waivers and Non Adherences

To note the approved WARNS issued between the 1st of February 2017 and the 31st of August 2017.

Minutes:

RESOLVED

 

That the approved WARNs be noted.