Agenda and draft minutes

Venue: Council Chamber, Town Hall, Saturday Market Place, King's Lynn PE30 5DQ. View directions

Contact: Wendy Vincent, Democratic Services Officer, 01553 636661, Email:  wendy.vincent@west-norfolk.gov.uk 

Items
No. Item

A64

Apologies

Minutes:

Apologies for absence were received from Dan Cooke, Ernst and Young and Councillor Mrs S Squire.

A65

Minutes pdf icon PDF 88 KB

To approve the minutes from the Audit and Risk Committee held on 28 January 2019.

Minutes:

The minutes of Audit Committee meeting held on 28 January 2019 were agreed as a correct record and signed by the Chairman.

 

A66

Declarations of Interest

Please indicate if there are any interests which should be declared.  A declaration of an interest should indicate the nature of the interest (if not already declared on the Register of Interests) and the agenda item to which it relates.  If a disclosable pecuniary interest is declared, the Member should withdraw from the room whilst the matter is discussed.

 

These declarations apply to all Members present, whether the Member is part of the meeting, attending to speak as a local Member on any item or simply observing the meeting from the public seating area.

Minutes:

There were no declarations of interest.

A67

Urgent Business Under Standing Order 7

To consider any business which, by reason of special circumstances, the Chairman proposed to accept as urgent under Section 100(b)(4)(b) of the Local Government Act 1972.

Minutes:

There was no urgent business.

A68

Members Present Pursuant to Standing Order 34

Members wishing to speak pursuant to Standing Order 34 should inform the Chairman of their intention to do so and on what items they wish to be heard before the meeting commences.  Any Member attending the meeting under Standing Order 34 will only be permitted to speak on those items which have been previously notified to the Chairman

Minutes:

Councillor C Joyce for the Risk Based Verification Policy Update for 2019.2020 and the KLIC Review Report.

A69

Chairman's Correspondence

Minutes:

The Chairman reported that he had received emails regarding the agenda items.

A70

Annual Audit Plan for year ended 31 March 2019 - Ernst and Young, External Auditors pdf icon PDF 5 MB

Minutes:

M Hodgson, Ernst and Young presented the Annual Audit Plan and drew the Committee’s attention to the following sections of the report:

 

·         Fraud Risk had been divided into the following two areas:  Misstatements due to fraud or error and Incorrect capitalisation of revenue expenditure.

·         Finance Team Capacity – the Financial Services Manager who had been the key contact for the audit team in previous year would be leaving the council in March 2019 prior to the preparation of the 2018/19 Statement of Accounts.

·         Materiality had been set at £1.71 million, which represented 2% of the prior years gross expenditure on provision of services plus financial and investment expenditure.

·         All uncorrected misstatements relating to the primate statements would be reported to the Audit Committee during 2019.

·         Value for Money Risks

·         Reduction in External Auditor fees.

·         Ernst and Young Audit Team

 

In response to a question from Councillor Moriarty regarding specialists for the valuation of land and buildings, M Hodgson explained that the Borough Council had their own internal valuation team and the external auditors used the Borough Council’s in house team.  If, however, they disagreed with the Borough Council’s team, then Ernst and Young could obtain input from third party specialists.

 

The Chairman, Councillor Middleton thanked Mark Hodgson for attending and presenting the report.

 

RESOLVED: The Committee received and noted the Annual Audit Plan for year ended 31 March 2019.

 

A71

Certification of Claims Annual Report 2017/2018 pdf icon PDF 1 MB

Minutes:

M Hodgson, Ernst and Young presented the report which summarised the results of the external auditors work on the Borough Council of King’s Lynn and West Norfolk’s 2017/18 of the housing benefits subsidy claim.

 

Members’ attention was drawn to the following sections of the report:

 

·         Value of claim presented for certification - £37m

·         The most significant amendment was due to the result of an issued identified by the Council.  The council notified the Department of Work and Pensions of an error regarding classification of benefit expenditure on supported housing claims.  The external auditors had liaised with the Executive Director Financial Services

·         No materiality was found.

 

In response to a question from Councillor Tilbrook on the over-claimed subsidy amounting to £191,432, the Revenues and Benefits Manager provided an explanation as to why this technical error had occurred.

 

RESOLVED:  The Audit Committee received and noted the Certification of Claims Annual Report 2017/2018.

 

A72

Draft Code of Corporate Governance pdf icon PDF 249 KB

Minutes:

In presenting the report, the Senior Policy and Performance Officer reminded Members of the terms of reference of the Audit Committee.

 

Members were informed that the report provided an updated code of corporate governance for consideration.  The Code also informed the preparation of the statutory Annual Governance Statement.

 

In response to questions from Councillor Moriarty, the Senior Policy and Performance Officer explained that the report outlined revisions to the Draft Code of Corporate Governance which included the minor changes to principles.  The Committee was advised that the 2016 framework had 7 principles compares to 6 within the 2012 version.

 

In responses to further questions from Councillor Moriarty relating to cultural changed and how this would be delivered and monitored throughout the Council, the Chief Executive referred to the exchange of emails between Councillor Moriarty and himself.  The Chief Executive advised that cultural change would be implemented using a variety of methods, which would evolve over the coming weeks.

 

RESOVLED: The Committee:

 

1)    Reviewed the draft Code of Corporate Governance.

2)    Recommended the Code for approval by Cabinet.

 

A73

Strategic Internal Audit Plan 2019/20124 pdf icon PDF 189 KB

Minutes:

The Audit Manager presented the Internal Audit Strategic Plan 2019/2024 which provided the Committee with the opportunity to review the proposed Strategic Internal Audit Plan for 2019/2024.

 

Members were reminded that the Audit Manager had to provide an annual internal Audit opinion on the system of internal control to support the Annual Governance Statement.

 

The Committee’s attention was drawn to the following sections of the report:

 

·         Purpose of the report.

·         Key Issues

·         Annual Audit Option.

·         Reasons for recommendations.

·         Audit Plan for 2019/2020 had been agreed by the Council’s Management Team.

·         Audit Plan 2020/2024 indicated the work proposed by the Audit Manager for the internal audit function for the next five years which could be subject to change.

 

The Audit Manager responded to questions relating to:

 

·         Number of contingency days built into the audit plan and how the contingency days were reviewed, which could include bringing forward an audit if considered appropriate.

·         Audit of Major Projects

·         Regeneration and Economic Development being identifying as medium risk rating.

 

The Audit Manager to include the number of days spent on each audit in the next report to the Audit Committee.

 

RESOLVED:  The Committee acknowledged the Internal Audit resources and agreed the work planned for 2019/2024.

 

A74

Exclusion of Press and Public

 

To consider passing the following resolution:

 

That under Section 100(A)(4) of the Local Government Act, 1972, the press and public be excluded from the meeting for the following item of business on the grounds that if involves the likely disclosure of exempt information as defined in paragraphs 1, 2, 3 of Part 1 of Schedule 12A to the Act.

 

Minutes:

The Chairman, Councillor Middleton invited the legal adviser to outline the reasons why the report was exempt prior to the Committee voted on the resolution to exclude the press and public from the meeting for consideration of the KLIC Review Report.

 

The legal adviser explained that the information contained in the report was exempt under a number of paragraphs of Schedule 12A as set out below:

 

Paragraphs 1 and 2

 

Officers are named and identifiable.

 

Paragraph 5

 

The information relates to the financial assistance provided to an organisation.

 

Paragraph 7

 

The information relates to the financial affairs of both an organisation and the Borough Council.

 

Paragraph 9

 

The information touches on the potential reacquisition of the leasehold interest interest.

 

Paragraph 12

 

The report contains details of legal advice.

 

The Committee voted to exclude the press and public and

 

RESOLVED:  That under Section 100(A)(4) of the Local Government Act, 1972, the press and public be excluded from the meeting for the following items of business on the grounds that it involves the likely disclosure of exempt information as defined in paragraphs 1, 2, 5, 7, 9 and 12 of Part 1 of Schedule 12A to the Act.

 

A75

Exempt Report: Risk Based Verification Policy Update for 2019/2020

Minutes:

In presenting the report, the Revenues and Benefits Manager explained that the Council introduced Risk Based Verification (RBV) to assess the risk of fraud and error in new claims for Housing Benefit and Council Tax Support from April 2015.  In February 2016 RBV was extended to include changes of circumstance.  The report provided an update for the Committee on RBV activity over the past year, and made some minor updates to the RBV policy.

 

The Revenues and Benefits Manager responded to questions from the Council.

 

RESOLVED: Members noted and agreed the RBV policy and the RBV procedure updates in the report.

 

A76

Exempt Report: KLIC Review Report pdf icon PDF 6 MB

Minutes:

The Internal Audit Manager presented the report.

 

The Committee discussed the report.

 

At the invitation of the Chairman, Councillor Joyce addressed the Committee under Standing Order 34.

 

In accordance with Standing Order 33.1 – “A Meeting including a Meeting of a Task Group which has sat continuously for three hours shall be adjourned automatically unless the majority of members present vote to continue to sit” . At 8.00 pm, the Committee voted and agreed to continue the meeting until the debate on the report had concluded.

 

The Chairman, Leader, Portfolio Holder, Chief Executive, Deputy Chief Executive, Internal Audit Manager and Property Services Manager responded to questions and comments from the Committee.

 

RESOLVED: 1) Eastlaw does provide a redacted version of the report for the Council with reasons for redactions, as soon as possible.

 

2) A cross party working group be established to consider the report, lessons learnt and a way forward and report back to the Audit Committee.

 

3) The Major Projects Board does establish a report mechanism to enable the Audit Committee to monitor major projects and identify any steps or action required and commence a programme of reviewing each of the large scale projects currently underway.

 

RETURNED TO OPEN SESSION

A77

Committee Work Programme 2019/2020 pdf icon PDF 56 KB

To note the Committee’s Work Programme for 2019/2020

Minutes:

The Committee noted the work programme.

A78

Date of Next Meeting

To note that the date of the next meeting of the Audit Committee will take place on 3 June 2019 at 5.00 pm in the Council Chamber, Town Hall, Saturday Market Place, King’s Lynn.

Minutes:

The next meeting of the Audit Committee will be held on 3 June 2019 at 5.00 pm in the Council Chamber, Town Hall, Saturday Market Place, King’s Lynn.