Agenda and draft minutes

Venue: Virtual Meeting

Contact: Steve Wood  020 8313 4316

Items
No. Item

60.

APOLOGIES FOR ABSENCE AND NOTIFICATION OF SUBSTITUTE MEMBERS

Minutes:

No apologies for absence were received.

61.

DECLARATIONS OF INTEREST

Minutes:

Councillor Evans declared an interest as a Governor of Saint Olave’s School . Councillor Wells declared an interest in that he sat on the Court of Saint Olave’s and Saint Saviour’s Schools.

62.

CONFIRMATION OF THE MINUTES OF THE MEETING HELD ON 3rd NOVEMBER 2020 (EXCLUDING THOSE CONTAINING EXEMPT INFORMATION) pdf icon PDF 331 KB

Minutes:

The minutes of the meeting of the Audit Sub-Committee that sat on 3rd of November 2020, (excluding those that contained exempt information) were agreed as a correct record.

63.

QUESTIONS TO THE AUDIT SUB COMMITTEE

In accordance with the Council’s Constitution, questions that are not specific to reports on the agenda must have been received in writing 10 working days before the date of the meeting. So any questions for the Audit Sub Committee would have been due to be received by close of business on 23rd February 2021. 

 

Questions specifically concerning reports on the agenda should be received within two working days of the publication date of the agenda.  Therefore, please ensure that questions specifically regarding reports on the agenda are received by the Democratic Services Team by 5pm on 3rd March 2021.

 

Any questions for reports on the agenda can be sent direct to stephen.wood@bromley.gov.uk  

 

Minutes:

No questions had been received.

64.

MATTERS ARISING pdf icon PDF 210 KB

Minutes:

CSD 21029

 

The Committee discussed the matters that had arisen at the previous meeting.

 

The Chairman noted that 2/3 of the matters outlined would be updated upon in the Internal Audit Progress report.

 

The first matter was concerning training being provided to members of the Committee, and the Chairman hoped that Members had been able to attend the recent training session that had been provided by Mazars, and he asked for feedback concerning this. A Member felt that the profile of the Committee could be increased if there was a report from the Audit Sub-Committee going to Full Council at least once a year. A discussion took place about the possibility of raising the profile of the sub-committee to enable it to be upgraded to a full committee, rather than being a sub-committee of the GP&L Committee.

 

The Chairman remarked that in the training it was recommended that the Chief Executive should attend the Audit Sub-Committee on a regular basis. He expressed the view that this was not required, and that on some occasions (when necessary), Chief Officers had attended meetings of the Sub-Committee. A Member commented that currently, discussions were being made concerning the status of the Pensions and Investment Sub-Committee, so now may be an appropriate time to have similar discussions with respect to the Audit Sub-Committee. A Member remarked that it was the case that the minutes of the Audit Sub-Committee were sent to the GP&L Committee, but as far as he was aware, the GP&L Committee did not have the authority to overrule any decisions made by the Audit-Sub Committee. A number of Members felt that this being the case, there were grounds for making the Audit Sub-Committee a full committee that reported to Full Council.

 

The Head of Audit and Assurance said that in Bromley Council, the functions of audit scrutiny were dealt with between the GP&L Committee and the Audit Sub-Committee. In Bromley it was the case that the GP&L Committee dealt with the statutory accounts. He explained that as a result of the Redmond Review, the MHCLG (Ministry for Housing, Communities and Local Government) supported the idea that an annual report from the External Auditors should be submitted to Full Council. If this was the case going forward, then it may be appropriate for the Audit Sub-Committee (or Audit Committee if the Sub-Committee became a full committee) to present a report to Full Council at the same time. It was noted that the MHCLG was currently working on guidance for councils (in collaboration with CIPFA, the NAO and LGA) concerning the submission of audit reports to Full Council and were also considering what guidance should be provided with respect to appointing independent members to audit committees. The Chairman asked if these proposed changes had implications in terms of the Council’s resources. The Head of Audit and Assurance responded in the affirmative and commented that it would be important to avoid duplication.

 

 

 

There was a general consensus amongst Members  ...  view the full minutes text for item 64.

65.

INTERNAL AUDIT REPORTS PUBLISHED ON THE COUNCIL WEBSITE

Internal Audit has published the following reports on the Council Website:

 

1.  Community Testing Grant Letter of Confirmation.

 

2.  Covid 19 Claim Process for the Retail, Hospitality and Leisure Grant Fund Scheme

 

3.  Covid 19 Claim Process for the Small Business Grant Fund Scheme

 

4.  Review of Purchasing Cards

 

5.  Review of Payroll, Expenses, Allowances and Overtime

 

 

The link to the reports is:

 

https://cds.bromley.gov.uk/ieListDocuments.aspx?CId=559&MId=7192&Ver=4

 

 

Please advise by 5.00pm on 3rd March if you have any questions regarding these reports.

 

 

 

Minutes:

No questions had been received regarding the internal audit reports that had been published on the Council website.

 

RESOLVED that the internal audit reports published on the Council website be noted.

66.

ANNUAL INTERNAL AUDIT PLAN 2021-22 AND INTERNAL AUDIT CHARTER pdf icon PDF 234 KB

Additional documents:

Minutes:

FSD 21013

 

The Internal Audit Plan had been affected by the Covid pandemic. It was difficult to know going forward what would be the ‘new normal’. This being the case, the Internal Audit Plan was more of a ‘statement of intent’. The Internal Audit Team would need to be flexible and agile. The current recovery audit plan had been affected by the Covid lockdown because staff had been seconded to work on pandemic related duties and other staff were providing assurance and anti fraud checks on business support grants. The Head of Audit and Assurance explained that the Internal Audit Plan had gone for review to the Corporate Leadership Team (CLT) and that the CLT had approved the plan. Some work was being rolled forward and the Internal Audit Team had been  looking at new areas of risk with CLT. More government grant relief money was due to come in and this would need to be processed and assurance provided to government.

 

The Head of Internal Audit and Assurance updated members regarding the Internal Audit Charter, explaining that the Charter outlined the status and authority of internal audit. There had on this occasion been some specific guidance provided with respect to the contents of the Charter which made allowances for the pandemic.

 

A Member enquired as to how much work undertaken by the Audit Team had been related to the Covid Pandemic, and how much resource was likely to be allocated to Covid related work going forward. The Head of Audit and Assurance did not have the information to hand and estimated that over the previous year 60% of the work undertaken by the Audit Team had been Covid related. He said that he would check on this figure and update the Committee. Going forward, out of 881 planned audit days, it was estimated that 145 days would be taken up by work that was Covid related. It was hoped that the Team would be working on ‘business as usual’ by June. The Head of Audit and Assurance complimented the work that had been undertaken by Liberata’s Technology Team in designing appropriate systems. 

 

The Vice Chairman asked (given the extra workload) if the current staffing levels of the Internal Audit Team were sufficient. The Head of Audit and Assurance answered that the Internal Audit Team were coping for now, but the position on a long term basis was not sustainable.

 

It was noted that the services of Mazars had not been called upon in the last financial year. They had their own core contracts with councils that did not have their own internal audit staff. The Head of Audit and Assurance clarified that he had a budget of approximately £16k that could be used as required to support the Internal Audit Team, and that he had been in discussions with Mazars about the possibility of them undertaking 2 pieces of work for LBB.

 

A Member  agreed that the Internal Audit Team should use the concept of ‘risk’ to decide where  ...  view the full minutes text for item 66.

67.

INTERNAL AUDIT PROGRESS REPORT pdf icon PDF 697 KB

Additional documents:

Minutes:

FSD 21012

 

The Committee was updated with respect to the audit of purchasing cards. This was because it was noted in the audit report dated January 2021, that there were three P1 recommendations outstanding. These had now been addressed.  The Committee noted that currently, many controls were effective; however there were still inadequate controls in certain areas. There were issues with direct debit payments, where certain members of staff would set these up for efficiency reasons, but when said member of staff was off sick or left the organisation--then no one knew how to cancel the direct debits. It was also the case that when members of staff had left the organisation, purchasing cards were not being deactivated. There were also issues with inadequate controls for managing credit limits. It was anticipated that all the remaining issues would be ironed out in due course; for now, the audit opinion was ‘reasonable’.

 

Members were updated concerning the review of payroll. It was agreed that more effort should be made by claimants to put in their expenses claims in a timely manner. The audit opinion for payroll was ‘reasonable’. Four P2 recommendations had been made which had been accepted by management.

 

The Committee was updated regarding the audit of small business support grants. The purpose of the audit review was to examine the effectiveness of controls operated by the Finance Directorate and the Council’s Exchequer Contractor for the payment of small business support grants that had been made available to small businesses as a result of the Covid pandemic. Controls were in place and were working very well, and the overall audit opinion was ‘substantial’. Members were pleased to note the extensive controls that had been put in place. It was noted that out of 2007 payments made, (totalling over £20m), there had only been 1% of claims associated with fraud, error or non-compliance. Similarly, the review of Retail, Leisure and Hospitality Support Grants had also received an overall audit opinion that was ‘substantial’. 

 

Members received an update concerning ‘Starters and Leavers’. The Head of Audit and Assurance acknowledged Members’ frustrations that the issues concerning Starters and Leavers had still not yet been fully resolved. He said that he had attended meetings of the CLT (Corporate Leadership Team) and various managers briefing meetings, and had explained clearly what the current procedures were, and what managers should do—so managers were now without excuse. The Head of Audit and Assurance explained that a simpler process was being developed, so that instead of managers having to fill in separate forms for HR and IT, there would just be one form to fill in. The new streamlined process was anticipated to be operational by the end of April. 

 

The Committee heard that in some cases, accounts had been left open for what the managers would perceive as being ‘practical’ reasons in terms of trying to assist operational processes in handover situations. The Head of Audit and Assurance had reported back on  ...  view the full minutes text for item 67.

68.

LOCAL GOVERNMENT ACT 1972 AS AMENDED BY THE LOCAL GOVERNMENT (ACCESS TO INFORMATION) (VARIATION) ORDER 2006 AND THE FREEDOM OF INFORMATION ACT 2000

  The Chairman to move that the Press and public be excluded during consideration of the item of business listed below as it is likely in view of the nature of the business to be transacted or the nature of the proceedings that if members of the Press and public were present there would be disclosure to them of exempt information.

Minutes:

RESOLVED that the press and public be excluded during consideration of the items of business listed below as it was likely in view of the nature of the business to be transacted or the nature of the proceedings, that if members of the press and public were present, there would be disclosure to them of exempt information.

69.

INTERNAL AUDIT FRAUD AND INVESTIGATION REPORT

Minutes:

 

FSD 21013

 

The report provided an overview of Counter Fraud work in 2020/21. The report detailed updates on previous reported cases, expanded on new cases of interest and detailed cases on the fraud register.

 

As the contents of this report are confidential, the minutes for this item have been detailed in the exempt minutes.

 

RESOLVED that the Internal Fraud and Investigation report be noted.

 

70.

EXEMPT MINUTES OF THE MEETING HELD ON 3rd NOVEMBER 2020

Minutes:

The exempt minutes of the meeting held on 3rd November 2020 were agreed as a correct record.

 

Original Text: