Venue: Meeting Room G.01, Ground Floor, City Hall, 115 Charles Street, Leicester, LE1 1FZ
Contact: Angie Smith, Democratic Support Officer
APOLOGIES FOR ABSENCE
Apologies for absence were received from Councillors Dr. Moore and O’Donnell. Councillor O’Donnell, however, joined the meeting remotely but could not be recorded as present under the Local Government Act 1972 which requires Members to be present in the room where the meeting was being held.
DECLARATIONS OF INTEREST
Members are asked to declare any interests they may have in the business to be discussed.
There were no declarations of interest made.
The Minutes of the previous meeting of the Audit and Risk Committee held on 21st July 2021 are attached, and Members will be asked to confirm them as a correct record.
That the minutes of the meeting held on 21 July 2021 be confirmed as a correct record.
The Chief Operating Officer submits a report to the Audit and Risk Committee to seek approval for the Council’s Annual Governance Statement and Annual Accounts for 2020/21. The report also provides the Committee with an update from the External Auditor, which details their audit work and any recommendations.
The Committee is recommended to:
· note the auditor’s ISA 260 Report to those charged with Governance and the recommendations contained within it;
· approve the Statement of Accounts for 2020/21;
· approve the Annual Governance Statement 2020/21;
· approve the letter of representation submitted by the Chief Operating Officer (S151);
· delegate authority to approve minor amendments to the Annual Accounts and Annual Governance Statement to the Chief Operating Officer (S151), subject to a report to the Committee at the next meeting;
· delegate authority to the Chief Operating Officer (S151) to make the IAS 19 adjustments as detailed in the report.
The Chief Operating Officer (in her capacity as the s151 officer) submitted a report to the Audit and Risk Committee which sought approval for the Council’s Annual Governance Statement and Statutory Statement of Accounts for 2020/21 as required under the Accounts and Audit (England) Regulations 2015. The report also provided the Committee with an update from the External Auditor, which detailed their audit work and recommendations.
Ben Matthews, Senior Accountant (Capital and Projects) presented the report.
Members were reminded that the draft Statement of Accounts and Annual Governance Statement were presented at the previous meeting of the Committee on 21 July 2021. Members were informed the Statutory Statement of Accounts with minor adjustments, the Annual Governance Statement 2020/21 and Letter of Representation were recommended to be approved by the Committee.
The following key points were brought to Members’ attention:
· The Statement of Accounts Audit was all but completed. There were three adjustments to put through, but it was important to note the changes would not affect the Council’s useable reserve balances.
o The impairment of two assets that should not have been held on the balance sheet, namely, St Margaret’s Bus Station and Waterside Primary Project.
o The updating of some Housing Revenue Account asset values.
o A future adjustment to the accounts as a result of late changes to the pension fund report following an update in asset valuations. Information was still awaited and the change had not been made to the accounts presented.
· Due to the fact the changes would not have any effect on the useable reserve balances, officers were seeking delegated authority to the Section151 officer to approve the changes.
· There were no changes to the Annual Governance Statement since the presentation of the draft report.
Grant Patterson (Grant Thornton LLP UK, External Auditors) presented the draft ISA 260 report, and draft audit findings.
Members noted that:
· Thanks were expressed to the Deputy Director of Finance, Head of Finance and Team for their assistance and support to the External Auditor.
· Audit adjustments were detailed in Appendix C to the report, none of which affected the bottom-line figure of the financial statements.
· External Audit were proposing an unqualified opinion on the Council’s financial statements.
· In terms of Value for Money (VFM), External Audit were not in a position to finalise the VFM conclusion. In line with the National Audit Office’s revised deadline due to the pandemic, the Annual Audit Report could be issued within three months of the audit opinion, and was expected to be finalised by December 2021.
· As part of the overall conclusion the report contained a narrative statement and annual governance statement as other information, and there were no matters to raise.
· In terms of detailed work, most of the audit work was substantially complete, and outstanding works were RAG rated.
· In terms of valuation of land and buildings, some queries had been returned back to the valuer, and information was expected back within a few days, but was not expected to be material. ... view the full minutes text for item 21.
The City Barrister and Head of Standards submits a report to the Audit and Risk Committee on the Council’s Contract Procedure rules as required annually. The purpose of the report is to inform the Committee of the activity of the procurement function of the Council (which comprises three specialist procurement teams: Procurement Services, ICT Procurement and ASC Procurement) over the previous financial year and evidence compliance with the requirements of the Contract Procedure Rules.
The Committee is recommended to note the contents of the report and make any comments to the City Barrister & Head of Standards.
The City Barrister and Head of Standards submitted a report to the Audit and Risk Committee on the Council’s Contract Procedure Rules as required annually. The purpose of the report was to inform the Committee of the activity of the procurement function of the Council over 2020/21 financial year (which comprised three specialist procurement teams: Procurement Services, ICT Procurement and ASC Procurement) and evidence compliance with the requirements of the Contract Procedure Rules.
Neil Bayliss, Head of Procurement, presented the report as required under the Council’s Constitution and Contract Procedure Rules, and brought to Members’ attention key aspects of the report as follows:
· There had been no impact from Brexit on procurement in terms of processes. Rules and contract procedures were not affected. However, supply difficulties were starting to be seen, for example, fuel and building materials.
· There were two changes to contract procedure rules to be brought to the attention of Members:
o A minor change under Rule 16.6 to reflect the change in management structure following the appointment of the Director of Finance to Chief Operating Officer, and the responsibility for IT now sat with the Director of Delivery, communications and Political Governance;
o Amendment to the wording of Rule 32 (Reserved Contracts) as outlined in the report, which talked about reserved contracts below a threshold and could only be used for Services contracts. The change had been introduced to help procurement services work with and award contracts to local businesses and voluntary and community sector organisations.
· The report gave an overview of key statistics in terms of contracts awarded as a procurement function of the Council, in total 185 contracts were awarded, and the variety of procurement activity was significant.
· It was important to note the Council’s procurement function played an important role to the Covid-19 pandemic, the most significant part being procurement of PPE equipment.
· The summary of waivers highlighted a significant reduction in the number of waivers. There had been an increase in value largely down to one significant value of construction works which was needed to ensure the Council met grant funding timescales and to assist with carbon reduction in council houses.
The Chair thanked the officer for the report.
1. That the Committee note the contents of the report and make any comments to the City Barrister and Head of Standards.
The Internal Auditor submits a report which provides the Audit & Risk Committee with a summary of progress against the 2020/21 and 2021/22 Internal Audit Plans, information on resources used to progress the plans and summary information on high importance recommendations and progress with implementing them.
The Committee is recommended to note the contents of the update report.
The Internal Auditor submitted a report which provided the Audit & Risk Committee with a summary of progress against the 2020/21 and 2021/22 Internal Audit Plans, information on resources used to progress the plans and summary information on high importance recommendations and progress with implementing them.
Neil Jones, Head of Internal Audit Service (HoIAS), presented the report and highlighted the following information:
· Under the Council’s Constitution the Committee had a duty to monitor performance against the Internal Audit Plan and the receive summaries of Internal Audit reports and the main issues arising.
· It was noted that the Internal Audit Service continued to work remotely and continued to experience service pressures. Nevertheless, things were progressing and had improved over the past few weeks.
· Appendix 1 to the report provided a rolling picture against audits completed, in progress or due to start. Anything in bold font noted a change in status since it was last reported to Committee. A further five audits had been completed since the writing of the report, and some audits had moved from ‘planning’ to ‘work in progress’ stage.
· Information was summarised at paragraph 9 in the report and showed 221 days of resources had been provided.
· The implementation of high important recommendations was reported on in detail at Appendix 2 to the report, and anything in bold font depicted a change from when it was last reported to Committee in July 2021.
· Further updates had been received on two audits’ recommendations: Government Procurement Cards; and Social Value within Procurement.
The Chair thanked Neil and officers for the report.
1. That the Committee note the contents of the update report.
The workplan for the Audit and Risk Committee is attached.
The Committee workplan was noted.
The Deputy Director of Finance noted the number of reports planned to be presented at the November meeting was particularly large. A view would be taken at the agenda items and timings for the next meeting.
ANY OTHER URGENT BUSINESS
There being no items of urgent business the meeting closed at 6.31pm.