Venue: Committee Room, Municipal Buildings, West Street, Boston, PE21 8QR
Contact: Janette Collier, Senior Democratic Services Officer 01205 314227 email: firstname.lastname@example.org
To sign and confirm the minutes of the last meeting, held on 22nd July 2019.
The minutes of the Committee’s last meeting, held on 22nd July 2019, were agreed as a correct record and signed by the Chairman. Hard copy of the information requested at the last meeting, relating to Internal Audit recommendations where the deadlines had been extended, (Minute 17 refers), had been circulated.
(A report presented by Jon Machej, Engagement Manager, Mazars)
Jon Machej, Engagement Manager, Mazars, presented the Annual Audit Letter, which summarised the key findings from the audit work undertaken by Mazars for the year ending 31st March 2019.
The letter was addressed to the Council, but was designed to be read by the public and other external stakeholders.
In response to questions, Mr Machej explained that WGA stood for Whole of Government Accounts and that these would be consolidated into the UK accounts.
A Member referred to the Council’s investment in property funds and expressed the view that Committee Members would require further training in order to properly question the fund managers when they came to give presentations to the Committee.
For clarification of the details regarding the investment, it was explained that the assumption was that the Council would benefit from an average net return, after borrowing costs, equating to £1,720,000 per year over the proposed 50-year term. These figures were based on information provided by officers in accordance with the Council’s Capital Strategy agreed in April 2018.
It was confirmed that the Council’s pension liability had increased by £0.8m to approximately £38m.
A Member suggested that, as the document was aimed at the public, it would be useful for it to contain a glossary of terms.
(A report presented by Suzanne Rolfe, Transformation & Governance Manager, to include an overview of the arrangements in place at the Council)
The Transformation & Governance Manager presented a report containing risk management guidance and an update on risks in Quarter 1 (April to June 2019). The Council’s risk management strategy was attached at Appendix A.
Strategic risks were monitored each quarter, i.e. those risks that could impact most on the achievement of the Council’s corporate priorities as set out in the current Corporate Plan – Prosperity; People; Place; Public Service. There were no new strategic risks to report in Quarter 1. The two highest risks for Quarter 1 remained housing and budget.
The report summarised the strategic risks with additional details contained in Appendix B and full details at Appendix C for training purposes.
The strategic risks for 2019/20 and the risk management framework would be reviewed alongside the development of the next Corporate Plan.
The operational risks for 2019/20 had been reviewed by service managers as part of service planning for 2019/20 and a summary was set out in the report.
Members discussed issues relating to the risk of fluvial as well as tidal flooding and the uncertainty of the effects of Brexit.
In response to questions, it was explained that Alfresco was the Council’s document management system, enabling all documents to be held in one place. It was anticipated that Climate Change would be considered in terms of risk as part of the review of the framework and the development of the next Corporate Plan. The housing delivery actions given in the details of the housing risk in the strategic risks in Appendix B were contained within the existing Housing Strategy.
A query was raised with respect to the table that set out the scoring of the likelihood and impact of risks. The Chief Finance Officer explained that the aim of this guide was to enable risks to be prioritised and managed accordingly. The bar to separate the impact of risks into ‘negligible’ and ‘minor’ impact had to be set at some point and allow the risks to be evenly spread throughout the scoring. The figures had to be set in context against the value of the Council’s assets and expenditure, though the Council would not want to lose any sum.
The risk management strategy document and the Transformation & Governance Manager’s presentation were commended.
(A report to be presented by John Scott, Internal Audit Manager)
The Principal Auditor presented the Internal Audit Progress Report.
There were five audits in progress:
· ICT Assurance map
· Medium Term Financial Strategy
· Debtors Key Controls
· Creditors Key Controls
The Principal Auditor advised Members that it was anticipated the Health and Safety Audit would be reported to the Committee’s next meeting.
Management were making good progress with implementing the recommendations from the Homelessness audit and an information sheet with further details was circulated to the meeting.
Due to management scheduling, more audits would be completed during the second half of year than during the first. All audits planned for Quarter 2 were on track.
During debate, a Member referred to the value of attending meetings of the Audit Committee Forum and urged Members to attend the meeting arranged for 1st October 2019.
Members discussed the issue of cash-handling with respect to market income and it was suggested that the system should be converted to a non-cash system.
The Chief Finance Officer confirmed that there had been liaison with the Head of Service on this matter and efforts had been made to do so. However, it would be difficult to change the system as the service was fundamentally cash-based and traders were more comfortable with it. Also, some traders were casual and would not wish to pay in advance when they were not sure they would operate on a particular day.
A Member commented that continuing with the cash system would be preferable to deterring traders.
(For Members to consider the Committee’s work programme.)
Members recognised the importance of their role in questioning the fund managers, as the property funds were the Council’s largest investment. Some felt further training would be crucial; however, it was suggested that the fund managers could address the Committee in turn at future meetings and Members would learn from each session. It was suggested the property fund managers could attend quarterly.
The Chief Finance Officer advised Members that the Capital Strategy, agreed in April 2018, had anticipated inviting property fund managers to address the Committee, but this had been delayed due to the May Elections and Link Asset Services had presented to Members of the Committee prior to this meeting. The property funds were a long-term investment and the role of the Committee was to monitor the performance of the property funds over the medium to long-term; therefore, Members would get to know the fund managers over time. Members could receive presentations from, say, two fund managers and then identify areas for further training. In the meantime, Members were reminded that they could contact the Chief Finance Officer if there were any issues they were unclear about.