Agenda and draft minutes

There were no items were the public and press were to be excluded from the meeting.

There were no declarations made at the meeting.

RESOLVED that the minutes of the Audit Committee meeting held on 28th July 2022, be approved as a correct record and signed by the Chair.

Peter Jackson, Head of Internal Audit presented the Actions Log report and updated Members on the actions agreed at previous Audit Committee meetings, allowing Members to monitor progress against the actions, ensuring that satisfactory progress was being made.

It was noted that all actions were completed and there were no follow up actions outstanding from previous meetings.

RESOLVED that the Audit Committee note the progress being made against the actions agreed at the previous meetings 

Debbie Hogg, Director of Corporate Resources introduced a report, and provided an overview of the revisions to the Performance Management Framework for the Council, and Statement of Implementation, outlining the mechanism by which the Council manage, monitor and govern key activities that contribute to the successful delivery of the Council’s Corporate Plan and its alignment to the ‘Doncaster Delivering Together’ Borough Strategy.

The Performance Management Framework had been developed as a tool so that the Council can monitor and review progress with delivering the priorities in the Corporate Plan and ensure good governance and accountability of its work.  The Framework had been reviewed in 2020 to ensure that it remained ‘fit for purpose’ during the challenging times of the Covid-19 pandemic. The aim of the Framework is to assist Senior Managers, staff and Councillors to understand the key components that contribute to effective performance, as well as providing a corporate approach for the Council.

The Framework brings together the following six key standalone elements of governance under one strategic umbrella and together these documents ensures that the Council have clear guidance and systems in place, and key responsibilities for delivery:-

·         Managing the Council’s Performance

·         Corporate Finance and Performance Reporting Profile

·         Service Planning

·         Risk Management Strategy

·         Data Information Quality Policy

·         Due Regard Statements

Paragraph 10 of the report set out a diagram, illustrating the structure, purpose and documents that made up the Framework and the improvements that have been made to the 6 elements of the framework were outlined in paragraph 11.

Further to clarity being sought regarding the resource management process, it was explained that this sets out the Council’s budget setting process and the budget control environment. The Assistant Director of Finance outlined the Council’s approach in terms of the budget setting process and provided an overview of the different stages of that process.  It was further explained that the resource management process was based on the Council having sufficient resources to deliver against the Council’s core priorities which was the beginning of the budget setting process. Other components of the performance management framework related to the service standards, firstly with regard to the policies that the Council want to pursue at a top level and the resources aligned to this, and the setting and monitoring of arrangements in place after that.

In response to a question with regard to the Council assessing the impact of risks and whether the Council have a criteria to quantify the impacts, make a judgement of those risks and what the impact it would have. It was clarified that as the Council is a multi-faceted organisation, the assessment of risks was subjective and explained the difficulty in assessing risks, as some risks may have financial impact, others may impact on a particular service and could potentially have political implications, which may be a reputational risk for the Council.

The Councils arrangements to deal with the management of risks to deliver the Council’s objectives form part of the budget setting process and each service  ...  view the full minutes text for item 68.

The Committee considered a report, presented by Holly Wilson, Head of Procurement which provided Members with details of all the waivers and breaches to the Council’s Contract Procedure Rules (CPRs) for the period 1st March 2022 to 31st August 2022. The report provided a summary of the new waivers and breaches recorded for each directorate since the last audit report presented to the Committee in April 2022 for comparative purposes.  Further details of each waiver and breach and the total contracts awarded versus the number and value of waivers for the period, were summarised in Appendices 1 to 3, respectively.

It was noted that there for the period 1st March 2022 to 31st August 2022 there had been 17 waivers granted which had increased from the last 6 month reporting period where there had been 14 waivers, however there had been a decrease to the amount of waivers for the previous 6 months period.  The figures remained static.

4 existing breaches from the previous reporting period had been positively resolved, but there were 6 new breaches as set out in Appendix 1 of the report. There were zero unresolved breaches.

Members sought clarity on aspects of the report, in particular in relation to the 4 new breaches in the Corporate Resources directorate relating to the schools catering department, as detailed at Appendix 1. Members asked for assurances to prevent this issue reoccurring in the future. The Head of Procurement outlined the reasons for the breach which were due to miscommunication and oversight within the department where officers had wrongly made the presumption that the extension period within the original awarded contract was to be extended, however this was not the case and unfortunately Officers had failed to notice the error. It was noted that currently the Procurement team operated from an established spreadsheet category plan system and a spend analysis system for the contracts register. On occasion there had been administrative errors in the system, but this was very rare. It was noted that the current spreadsheet system does not have the functionality to provide an audit trail of any changes made to the system. Members were advised that a new contract procurement pipeline module was to be implemented as part of the Council’s e-Tendering system.  The system would flag up when any new contracts were for renewal and would allow for data to be stored and managed in one central location. It was anticipated that the new system would go live in December 2022. Assurances were provided that the administrative errors previously made would not re-occur.

Members were pleased to note that there had been no further breaches in the Adults Health and Wellbeing directorate given the concerns raised by the Committee with regard to the issues in the previous year. Following a question by the Chair, the Head of Procurement confirmed that she was satisfied with the current arrangements and assured Members that the new contract pipeline module would help improve the data. In response to a request  ...  view the full minutes text for item 69.

Peter Jackson, Head of Internal Audit presented a report which provided an update on the work undertaken by Internal Audit for the period 1st July to 30th September 2022, as attached at Appendix 1 of the report.  The report also included details of planned audit work completed in the period which had previously been reported and the overdue high risk management actions arising from the audit recommendations which were appended to the report at Appendices A and B, respectively.

The Head of Internal Audit provided an update, summarising the key points in the report, and responded to questions and comments from Members in relation to each of the following four sections of the report:-

Section 1 - The Audit Plan / Revisions to the Plan

During the last quarter there had been a number of amendments to the Audit Plan, as set out in the report which help demonstrate that the plan would be kept under review in respect of work required by the authority.

Members welcomed the work carried out to resolve the outstanding high risk actions in the Trading Standards and Food Safety team, which had been a long standing issue and was no longer of concern. In response to a question, the Head of Internal Audit confirmed that the medium to low level risk management actions relating to the Economy and Environment directorate, as identified in the table at 3.5 of the report were low risks. Two of the risks had been approved, with the remaining low risk which related to a long standing issue over reconciliation of licensing income and Internal Audit was awaiting an update on this issue. 

In answer to a query with regard to Foster Care Payments, as set out in paragraph 1.5 of the report, the Head of Internal Audit explained the circumstances around Internal Audit raising specific concerns regarding significant amounts of overpayments previously made by the Fostering Team which had been transferred back into the Council on 1st September this year. The current Internal Audit provider contracts with DCST had also been transferred to the Council. Internal Audit was seeking assurance that the arrangements were working effectively. It was reported that a newfostering payments scheme had been approved during the summer which came into force in September 2022 and Internal Audit would seek further assurance regarding the systems and processes in place.

Concerns were raised regarding the potential impact on the Council in terms of the management of risks and the costs for the Children’s Trust coming back under the Council and whether the Committee would receive regular reporting on this issue. The Committee was assured that the overall transition programme of the Trust was being effectively managed. Internal Audit have liaised with the programme office to better understand the risks and the Trusts budgets had been transitioned and have been allocated against budget holders and these would be monitored as part of the Council’s quarterly monitoring report to Cabinet and Overview and Scrutiny. The reasons for the transferal  ...  view the full minutes text for item 70.

The Committee received a report, presented by Scott Cardwell, Assistant Director of Development and Dave Stimpson, Head of Property Services which provided Members with a quarterly progress update on the North Bridge Stores operational activities instigated following the Stores Management Review, in response to the internal audit carried out in 2019, and their involvement in the Personal Protective Equipment (PPE) stocktaking in 2020. The report was the sixth update provided to Members since the last update to the Committee in July 2022. Details of the key milestones to be completed for the period were set out at Paragraph 9 of the report.

The Head of Property Services outlined the key headlines from the report, in particular regarding the appointment of the new Stores Manager which was anticipated to be in place by the end of November 2022 and the ongoing work taking place by the interim stores manager, the customer and the SPT in making improvements to the stores in relation to the renewal of the contracts which had brought improvements at the stores and had reduced the number of stock lines, the value of stock held and had freed up space, therefore had obtained value for money.

The Committee welcomed the appointment of the Stores Manager post, the improvements made in relation to the accuracy of the half yearly full Stocktake, the progress made on the Key Performance Indicators to those previously reported to the Committee, and progress to date on the Implementation Plan. In referring to the Appendix of the report, Members noted that the Implementation Plan progress had been re-titled as the ‘Stores Project Masterplan Summary’ and in order to provide consistency and to avoid any confusion requested that in future that both the report and Appendix correspond.

Members acknowledged the reasons for deferment of the Stores User Survey and looked forward to seeing the results of the second survey in Quarter 3 to ascertain the feedback received from customers regarding the improvements made. In order to receive up to date information and provide real time feedback from stakeholders on an ongoing basis improvements made at the stores, Members felt that it would be useful to have a continuous and dynamic survey of the stores customer user base and whether the software used to analyse the results could accommodate this, as this would provide up to date information and alert Officers of any issues that may arise at an early stage as part of the improvement plan. The Head of Property Services agreed to explore this and advised that the next quarterly reporting period would allow for a benchmark to be set, therefore if any slippage to the improvement plan, could be raised at the stakeholder management meetings. He added that in relation to the KPIs, the targets in the plan for the last 4 to 5 months were soon to be met, therefore would provide the opportunity for the rest of the year to make the KPIs more challenging so progress could be reviewed in  ...  view the full minutes text for item 71.

Consideration was given to a report which sought approval of the Council’s audited Statement of Account 2021/22 and Annual Governance Statement for 2021/22, as attached to the Appendix to the report and the key issues that the Committee should consider before the External Auditor issued their opinion on the financial statements.

The Chair on behalf of the Committee thanked Grant Thornton and Officers in the Finance Team for completing the accounts in challenging circumstances. The Assistant Director of Finance responded by commending Grant Thornton and the Finance Team for their achievements in getting the accounts to the current position in view of the significant work undertaken.

Grant Thornton presented the ISA 260 report, detailing the key aspects of the External Auditors work for the 2021/22 audit of the Statement of Accounts. Perminder Sethi, Engagement Senior Manager, highlighted the key headlines from the executive summary and summarised the areas for the Committee to note.

It was noted that the audit was nearing completion, and there were no matters that required modification of the proposed audit opinion or material changes to the financial statements, subject to the completion of outstanding matters in respect of Pension fund assets and liabilities and publication of the Statutory Instrument from the Department for Levelling Up, Housing and Communities (DLUHC) on the statutory override for the accounting arrangements relating to infrastructure assets, as detailed on pages 3 and 4 of the ISO 260 report. 

No new risks or issues had been identified during the audit, however Grant Thornton had raised one audit recommendation for management arising from the audit in relation to the Council’s asset register for vehicles, plant and equipment, where a large number of assets had been fully depreciated and had shown a Net Book Value of zero, but still remained in the asset register, as detailed in the Action Plan at Appendix A.  The follow up recommendations from the previous year were also detailed at Appendix B.

It was anticipated that Grant Thornton would conclude the audit by the end of November in line with the statutory target and would give an unqualified opinion, however this was dependent upon the national infrastructure accounting issue across the sector being resolved via the issuing of a statutory instrument from the DLUHC.  The timing of the Statutory Instrument was hoped to be around 30 November to coincide with the statutory date, however the exact publication date was unclear and an unqualified audit opinion would not be issued until that time.

In relation to Value for Money (VFM) conclusion, due to the ongoing challenges impacting on the local audit market, including the need to meet regulatory and other professional requirements, Grant Thornton had been unable to complete its work as quickly as would normally be expected, therefore had not yet issued its Annual report and arrangements for value for money. It was anticipated that this would be issued by 26 January 2023 for submission to the Audit Committee, which would also be ahead of the National Audit  ...  view the full minutes text for item 72.