Agenda and minutes
PDF 227 KBVenue: Civic Suite, Lewisham Town Hall, London SE6 4RU
Contact: Olga Cole
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Additional documents: Minutes: RESOLVED that that the Minutes of the meeting of the Panel held on 20 November 2013, which was open to the press and public, be confirmed and signed as a true record of the proceedings, subject to the following:
para 5.7, last sentence delete ‘steps’ to read “The Interim Head of Corporate Resources confirmed the position is being closely monitored and assurances were given by the contractor that sufficient resources were in place to ensure the timely completion of the Plan, subject to no significant delays on the Council side.
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Declarations of Interests Minutes: None. |
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Update on 2013/14 Closing of Accounts and External Audit Additional documents: Minutes: The report was introduced by the Group Finance Manager-Core Accounting. He told Panel members that in previous years the Pre-Audited Statement and the Audited Statement of Accounts had been presented to the Audit Panel in June, but because of the elections, and new Council members’ induction, there would not be sufficient time to fit in an Audit Panel in June. Therefore the proposal was for the next Audit Panel to take place on 16 July. He added that the Audited Statement would be presented to the Audit Panel in September as usual.
The Chair said he could not understand why an Audit Panel meeting could not be scheduled in June, as it was important for Panel members to scrutinise the Pre-Audited Statement of Accounts before the September consideration of the audited accounts. Panel members were informed that there was no requirement under the code for elected members to scrutinise the Statement prior to it being signed off in June, but that it was best practice to do so. The only requirement was for the Executive Director for Resources and Regeneration, as the Section 151 Officer, to scrutinise it prior to the June sign off.
Panel members were informed that it had been decided to postpone the Audit Panel and Public Accounts Select Committee meetings until proper financial training has been completed by newly elected members to equip them for their new roles.
Paul Dale asked why Lewisham could not arrange training before the June meeting of the Audit Panel, as other Councils had managed to do so. Councillor Mallory stated that as Chair of the Standards Committee he had suggested that it was necessary to ensure that training and induction was completed before committee duties commence, and he had based this decision on past experience. Councillor Peake said he welcomed that decision but did not see why it should affect the Audit Panel cycle.
Panel Members stated that the AGM was on 11 June, and there should be sufficient time for members to be trained before an Audit Panel meeting later in June. The Head of Corporate Resources said that he would discuss this with Governance officers to address Panel members’ concerns. The Chair recommended that elected members should consider the Pre-Audited Statement before they are submitted to Grant Thornton for auditing. This was agreed.
Mr Dale asked officers if they had taken into account CIPFA’s Guidance on investment property, and asked whether the distinction had been made between operational and investment properties. The Group Finance Manager-Core Accounting said that properties listed under investment were only being used for investment purposes, and officers usually discuss this issue with the external auditor and make a judgement. Mike Robinson said that this issue would only be relevant if the figure would materially impact on the Accounts.
The Chair referred to recommendation 1 of the action plan in the 2012/13 Audit Findings Report by Grant Thornton, and stated that Assets and Asset Registers had always been an area of concern with the Panel ... view the full minutes text for item 9. |
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Grant Claims Certification Report Minutes: The report was introduced by the Director of Grant Thornton, Darren Wells. It was noted that the report gave a summary of Grant Thornton’s overall assessment of the Council’s management arrangements in respect of the certification process and drew attention to significant matters in relation to individual claims. Grant Thornton certified four claims and returns for the financial year 2012/13 relating to expenditure of £326 million.
Panel members were informed that the report also highlighted some issues identified and a significant one was with the arrangements for producing the Teachers Pensions. Panel members noted that the recommendations on page 21 of the report had been accepted by officers.
The Chair asked whether other councils had green ratings in their certification report. It was noted that some had green ratings but Grant Thornton were unable to say how many.
Mr King asked why there were so many problems related to the Teachers’ Pension return, and was told that it had been a major concern and responsibility had been moved from the previous section, as there were evidence of poor practice, and it was now back in the payroll section. Mr King said he was surprised, as this issue had not been made clear within the audit reports, and Panel members have been told in previous years that BACs had been improved.
Mike Robinson said that he could remember when he started about two and a half years ago when this issue was reported, and Panel members were told that this had been rectified, but now it had come to light there were still some areas were processes were still lax.
The Chair said he was concerned, because in the current climate of cuts, team changes and service reconfiguration unless this issue was dealt with urgently, six months down the line with fewer staff and more work there would be further slippage. The Group Finance Manager- Accounting and Capital informed Panel members that this was a one off, and would not happen again as officers were more focussed. The Chair asked if members could be provided with figures of how many London Councils had green ratings because if other London Councils could achieve this, Lewisham should be aspiring to do the same.
RESOLVED that the report be noted. |
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Presentation by Grant Thornton on their National Report on Financial Resilience of Local Authorities Minutes: Panel members received a presentation from Jamie Bewick on the following:
Panel members were informed that, overall, local authorities were delivering against their financial plans. However, the challenges were increasing, and some improvements in the last survey have reversed this year. It was also noted that a small number of authorities now have insufficient arrangements to ensure financial resilience. Panel members noted that Authorities would need to work hard in the following key areas to stay in robust financial health:
Strategic Financial Planning
Financial Control
Financial governance
Key Indicators of financial performance
In conclusion it was noted that authorities need to have
Paul Dale asked whether Grant Thornton had deduced that the quality of forecasting would likely change to red. The Chair added that this was because the next 4 years would be very challenging for the Council, as proposed savings had nearly doubled from £56m to around £104m. Jamie Bewick said that this information was not available when they did the audit.
Councillor Mallory said that he was surprised any Council managed to get a green rating, particularly those facing the challenges Lewisham was. Jamie Bewick said that they were aware that Lewisham was financially challenged, and stated that Sheffield, with similar challenges had a good rating. He added that Grant Thornton has a Good Practice Checklist and the Council could use this to do a self assessment.
The Chair asked whether there were other good practices examples that could apply to Lewisham that Panel members and officers ought to know about. Darren Wells said he could not think of anything at present, but if there was something he became aware of he would let Panel members and officers know. Councillor Ingleby asked for the update to this presentation to be circulated to Panel members. This was agreed.
Action >>> JB Grant Thornton |
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The Internal Audit Update and Plan Minutes: THE INTERNAL AUDIT UPDATE AND PLAN
The report was introduced by the Head of Corporate Resources, who informed Panel members that it was in three parts; the general progress update, the Audit Plan for next year and the Audit Charter. Panel members noted that the 2012/13 audit plan was completed. Panel members also noted a summary of the status of the 2013/14 audit plan as at end of February 2014. The Head of Corporate Resources informed Panel members that since the last Audit Panel meeting all medium and high risk recommendations have been agreed by managers, and officers would continue to follow up high risk recommendations. Also that the Council would, by mutual agreement, be taking back the internal audit service from Baker Tilly at the end of June 2013.
Mr King asked why the contractors had not completed the plan again this year after their undertaking at the last Panel to do so. The Head of Corporate Resources said that they had agreed to prioritise this work and would aim to complete it by end of June. Chris Harris, the Director for Baker Tilly recognised that the position was again behind plan and said as they would not be doing the 2014/15 audit for the Council, they intend to use their existing resources plus some additional resources to ensure that the 2013/14 work was completed at the end of June. Chris Harris assured Panel members that they would use their best resources to ensure the work was completed effectively. The Head of Corporate Resources said that Council officers and the Baker Tilly auditors would work together to achieve this.
David Webb asked if officers intended to complete the 2014/15 in 9 months instead of the usual 12 months, asking if they would be starting very soon. The Head of Corporate Resources said that officers would be working out the details between now and June. He added that Lewisham Homes would not be included in this work as they had already withdrawn from the arrangements and this would result in less work for officers. Mr Webb asked officers if they had discussed with Grant Thornton whether they would be able to deliver this work.
The Head of Corporate Resources said that officers had not yet discussed the details but were keeping Grant Thornton sighted on progress with the internal audit plan through regular liaison meetings. Chris Harris, Baker Tilly said they have more resources than they needed to deliver the plan by end of June, and they were confident they would deliver it. Mr Webb stated that Panel members had been given assurances in the past, but were yet to see it being delivered. Mr Dale asked how many audit days they were proposed for 2014/15, and was told 690 days. Mr Dale said this equated to less than 4 people, and raised the concern that this may not be sufficient.
The Head of Corporate Resources said that a lot of boroughs have reduced their audit functions, and that he ... view the full minutes text for item 12. |
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Anti-Fraud and Corruption Update Additional documents: Minutes: The Head of Corporate Resources informed Panel members that the report was a routine update to be reviewed in June. The Anti-Fraud & Corruption Team Manager highlighted the appendix benchmarked Lewisham nationally and against other London Boroughs The national figures showing the total cases detected in 2012/13. It was noted that nationally the number of detected frauds have fallen by 14% since 2011/12, and the value by less than 1%. Another diagram showed how Lewisham’s figures compared with other London Boroughs. It was noted that Lewisham ranked fourth in the number of cases detected, but officers did not know who the other 3 authorities were nor do they have any information about them, in terms of their size or the size of their counter-fraud teams.
The Anti-Fraud & Corruption Team Manager informed Panel members that Lewisham had a lower value of fraud detected, and said that this might be because they were caught earlier or the Council might take on low value fraud. It was noted that different boroughs value fraud differently, as it was not easy to quantify fraud. Panel members noted that Housing Benefit was experiencing a lot of changes, including a reduction in the number of investigators.
Panel members noted that Housing Stock fraud was one of the problematic areas. It was hoped that the figures would improve in the future. It was also noted that 3 Fraud Awareness sessions had been delivered by A-FACT to Lewisham Homes, two sessions to SELCHP, and a session tailored to the Council’s Human Resources Service. The Chair thanked officers for the report.
RESOLVED that the report be noted.
On behalf of the Audit Panel Councillor Mallory thanked Councillor Harris, outgoing Chair of Audit Panel for his time and dedication to the Panel over the last four years.
The meeting ended at 9.50p.m.
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