Agenda and minutes

To receive any apologies for absence from Members.

Apologies were received from Councillors B Drake and A Heler. Councillor R Bailey was present as substitute.

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

There were no declarations of interest.

To approve as a correct record the minutes of the meeting held on 24 February 2026.

During consideration of the minutes of the meeting held on 24 February 2026 the following points were raised:

-       Statement of Accounts: it was confirmed that the signed Statement of Accounts 2024-25 had been published on the council website and the committee had received notification of this.

-       Companies Audited Financial Statements: It was noted that the committee had received a written response in relation to the error on the ANSA/Orbitas statements. It was confirmed that the statements had been corrected. The committee requested that consideration be given to adding these alongside the Statement of Accounts on the council website.

RESOLVED:

That the minutes of the meeting held on 24 February 2026 be agreed as a correct record and signed by the Chair.

In accordance with paragraphs 2.24 of the Council’s Committee Procedure Rules and Appendix on Public Speaking a total period of 15 minutes is allocated for members of the public to put questions to the committee on any matter relating to this agenda. Each member of the public will be allowed up to two minutes each to speak, and the Chair will have discretion to vary this where they consider it appropriate.

Members of the public wishing to speak are required to provide notice of this at least three clear working days’ in advance of the meeting and should include the question with that notice.

There were no registered speakers.

To receive an update on the committee action log.

The committee received an update on the action log and noted the following:

• Written responses had been circulated to the committee and published as part of the action log with the agenda pack, in relation to the two issues raised at the last meeting (ANSA/Orbtias Profit Figures and Transition to Leader/Cabinet model and its consideration by the Constitution Working Group).

• Committee Self-Assessment: this was being progressed and would be rolled out once the membership of the committee had been agreed following Council in May 2026.

RESOLVED:

That the action log and updates received be noted.

To receive a verbal update on S106.

The committee received an update on the ongoing Internal Audit review of Section 106 processes, noting that the work had recently commenced but was not yet complete due to the complexity of the system. Members were advised that the review was being carried out in two parts: firstly, to confirm that previously agreed actions had been fully implemented and embedded into business?as?usual processes, and secondly, to assess the effectiveness of the overall Section 106 management arrangements. Of the 30 actions reviewed to date, 13 had been completed and signed off, one had been superseded following the insourcing of ANSA, one was partially completed, one not implemented, and 14 remained subject to further detailed testing. Officers confirmed that the additional work formed part of a deeper assurance exercise rather than outstanding actions from the original audit.

It was reported that the remaining work was progressing at pace and would inform the 2025–26 Internal Audit Opinion. A further report would be presented to the committee in July, with a member briefing to be arranged once the audit had been finalised. In response to member queries, it was confirmed that no S106 monies had been returned to developers, and the Exacom system was fully operational internally, with public access expected within the next few months subject to IT work and review of data accuracy. Members discussed the frequency and transparency of S106 reporting, including the role of the working group, the twice?yearly ward member reports, and the Infrastructure Funding Statement.

RESOLVED:

That the update be received and noted.

To receive the Enterprise Cheshire and Warrington 2024-25 Accounts.

The committee received the audited consolidated financial statements for Enterprise Cheshire and Warrington (ECW) for 2024/25, noting that the accounts, which included subsidiary Marketing Cheshire, had been signed off by Murray Smith LLP with an unmodified ‘true and fair’ audit opinion.

The committee noted that ECW had recorded a surplus of £0.086m for the year, with fixed and net assets showing small increases on the previous year, and that Cheshire East Council continued to act as the Accountable Body for relevant government?funded programmes.

Members raised queries relating to the directors’ remuneration noting that £36k had been paid during 2024, and £168,633 during 2025. The committee asked why this had increased so significantly. Officers committed to providing a written response.

Clarification was sought on whether ECW accounts were published on the Council’s website. It was clarified that whilst the accounts were not published on the website, they were referenced within the Statement of Accounts however officers committed to exploring this further.

The committee queried the loan balances outstanding for Cheshire East Council (£3.146m) and queried interest rates paid. Officers committed to providing a written response.

RESOLVED:

That the Audit and Governance Committee

1.    Note the consolidated Enterprise Cheshire and Warrington Accounts for 2024/25.

To receive a report on the revised Finance and Contract Procedure Rules.

The committee received the revised Finance and Contract Procedure Rules, previously approved by Full Council on 25 February 2026, noting that they formed a key part of the council’s financial, procurement and governance framework.

Members noted that the updated Procedure Rules strengthened controls around financial management, authorisation levels, procurement processes, contract management, risk, and audit responsibilities, and ensured alignment with current legislation and best practice ahead of the transition to the Leader/Cabinet governance model in May 2026. The committee also noted the intention to support implementation through staff training and updated operational guidance.

Officers confirmed that training was in place, updated budget management tools had been rolled out to budget holders, and the revised rules clarified roles, responsibilities, decision thresholds, and financial governance arrangements. Members discussed reserves, flexibility in response to changing economic conditions, and the non?retrospective application of the new rules. The Deputy Monitoring Officer provided clarification on the meaning of “minor” constitutional changes and how such amendments would be managed. The committee suggested that this delegation to the MO be recorded within the Procedure Rules.

During the discussion, members raised queries on write?off processes, internal audit involvement in new systems, budget amendment procedures, the Officer Decision Record process, the need for improved transparency, and the recording of approvals. Officers confirmed that internal audit oversight was built into the revised framework, that significant changes would continue to require member approval, and that modern.gov now provided a full audit trail for decision reports. Members also questioned school deficits, DSG treatment, and recovery plans, with officers confirming that deficits were monitored closely and that schools were required to submit recovery plans or seek licensed deficits where needed. Several drafting issues and minor errors within the documents were identified for correction.

RESOLVED:

1. Notes and receives the updated Procedure Rules as part of its responsibilities for maintaining oversight of the Council’s governance, risk management and internal control framework.

2. Endorses the Council resolution to incorporate the updated Procedure Rules into the Council’s governance framework, staff guidance, and internal training programme, ensuring effective awareness and adherence across the organisation.

To receive an update on the Internal Audit Plan 2025-26.

The committee received an update on work undertaken by Internal Audit between April and December 2025, noting that delivery of the 2025/26 Audit Plan remained broadly on target. Three final assurance reports had been issued (one Good and two Limited), with further reviews at draft stage and a number of audits in progress across key risk areas.

The committee noted that Limited assurances related to the SEND Self?Evaluation Framework and Leavers processes, where procedural gaps and inconsistencies were identified. It was reported that 42 audit actions remained outstanding, of which 17 were overdue, though most were nearing completion.

The committee also noted the positive outcome of the external peer review confirming that Internal Audit “conformed” to the Public Sector Internal Audit Standards, with improvement actions underway, and received an update on progress towards implementing the new Global Internal Audit Standards

It was noted that, given the scale of ongoing audit activity, the annual audit opinion was likely to remain “limited” for 2025–26, although a positive direction of travel was expected.

The committee’s attention was drawn to updated figures on outstanding audit actions, with 34 actions remaining, of which only six were overdue and 28 had not yet reached the agreed implementation date. Members queried reasons for delays, and officers confirmed that none related to major weaknesses and that most were close to completion. The committee received assurance that these were regularly discussed with Executive Directors and in Directorate Management meetings.

The committee queried the limited opinion on the IT equipment and system access and agreed that closure of access should be a priority. It was clarified that eight actions had been raised within the audit report, two of which had been completed, leaving six outstanding, one of which was slightly overdue but nearing completion and the remaining five were not yet due. Completion of all actions was expected by July 2026.

RESOLVED:

That the Audit and Governance Committee

1.    Note the update on progress against the 2025/26 Internal Audit Plan.

2.    Note the positive outcome of the peer review of internal audit against the PSIAS.

1.     

To receive an update on the Finance Leadership Improvement Plan.

The committee received an update on progress against the Finance Leadership Improvement Plan, noting significant movement since the previous report, with 33 of 81 actions completed, a further 12 addressed, 8 under review, and 28 in progress.

The committee noted the plan continued to respond to recommendations from the Corporate Peer Challenge, CIPFA Assurance Review, External Audit, and the CIPFA Financial Management Code. Key improvements highlighted included strengthened financial reporting, enhanced capital programme oversight, ongoing ERP system optimisation, revised MTFS format, improved financial training for officers and Members, and development of the Finance Service’s skills and capacity. The committee also noted that actions relating to reconciliations, asset valuations, IFRS 16 compliance, and declarations of interest were being implemented to agreed timelines.

Members emphasised the importance of evidencing financial benefits rather than progress on actions alone, particularly in relation to transformation. Members also discussed the need for sustainable leadership capacity, the challenges posed by ongoing funding pressures and wider financial uncertainty, and the risks highlighted around financial resilience, exceptional financial support, and delays to transformational change. Officers acknowledged these risks and explained the work underway to review the capital programme, develop savings proposals, plan for future budget gaps, and support political decision?making as the council moves to a Leader and Cabinet governance model.

RESOLVED:

1.    Note the content and progress made against the Finance Leadership Improvement Plan.

To receive the Treasury Management Strategy which details the activities of the Treasury Management function in the forthcoming year 2026/27.

The committee received the Treasury Management Strategy for 2026/27, noting that it set out the council’s approach to managing cash flows, borrowing, investments and related financial risks in line with the CIPFA Treasury Management and Prudential Codes.

Members were advised of the current economic context, including recent reductions to the Bank of England Bank Rate and expected inflation movements, and were informed that the council’s borrowing requirement was forecast to rise due to capital programme commitments. The Strategy outlined a balanced approach to borrowing, using a mix of short- and medium-term options, and confirmed that investment activity would continue to prioritise security and liquidity, supported by a minimum £20m investment balance and use of strategic pooled funds.

RESOLVED:

1. Note and comment on the Treasury Management Strategy which forms part of the Medium Term Financial Strategy, as approved at Council on 25 February 2026.

To consider the Internal Audit Plan for 2026-27.

The committee considered the proposed Internal Audit Plan for 2026/27, noting that it had been developed using a comprehensive risk?based approach aligned to the Cheshire East Plan 2025–29, the Strategic Risk Register and the Improvement & Transformation Delivery Plan.

The committee noted that the plan provided for 1,205 chargeable audit days delivered by the 6.3 FTE audit team, covering core control areas, key financial systems, governance, risk management, ICT, transformation activity, and themed reviews across all directorates. The committee noted that the plan was flexible to enable response to emerging risks and incorporated work to support compliance with the new Global Internal Audit Standards. Performance targets for delivery, quality and customer satisfaction were also highlighted.

A major focus of the forthcoming year would be a series of core control reviews across directorates, covering governance, people management, financial stewardship, risk, information governance, health and safety, fraud risk management, business continuity, and asset security. These reviews would provide both individual assurance reports and thematic findings, informing wider assurance mapping. The plan also incorporated a shift towards increased consultancy support to help shape change programmes proactively, alongside work to strengthen compliance with the new audit standards.

Members raised questions regarding resource capacity, the ambitious scale of the programme, and the reduction shown in the training allocation. Officers explained that associated development work had been moved into the chargeable audit plan due to the significant preparation required to implement the new standards.

Members sought assurance that emerging risks or service concerns, such as those raised in relation to parking, could be incorporated into the plan, and officers confirmed that the plan would remain agile and responsive throughout the year.

RESOLVED (by majority):

That the Audit and Governance Committee

1.    Approve the Internal Audit Plan 2026/27.

To consider the refreshed policy. (report to follow)

The committee considered the on the refreshed Whistleblowing Policy. Members were advised that the updates ensured continued compliance with legislation, including explicit alignment with the Employment Rights Act 2025 and the strengthened protections relating to sexual harassment from 6 April.

The committee noted that the revised policy would also be reflected on the council’s public webpages. Officers emphasised that the refresh formed part of wider ongoing work to support an open, transparent organisational culture and to ensure staff felt confident raising concerns at the earliest opportunity.

The committee was informed that the number of whistleblowing referrals for 2024–25 appeared higher due to multiple reports relating to a single issue, and that all referrals, whether meeting the threshold for public interest disclosures or not, were acknowledged and signposted to the appropriate processes, including HR, health and safety, or the complaints route.

Members welcomed the update and raised a suggestion to explicitly reference racial and disability discrimination within the policy, alongside sexual harassment. Officers agreed to seek Monitoring Officer advice on incorporating this amendment.

RESOLVED (by majority):

That the Audit and Governance Committee

1.    Note the use of the Council’s whistleblowing arrangements during 2024/25 and 2025/26 to date, and the proposals for further development of the Whistleblowing policy and supporting arrangements.

2.    Approve the updated Whistleblowing Policy at Appendix A.

To consider the Work Programme for the 2026-27 municipal year.

The committee considered the Work Programme for the 2026-27 municipal year.

RESOLVED:

That the Work Programme for the 2026-27 municipal year be received and noted.