Agenda and minutes

The Divisional Director of Public Health will deliver a presentation.

Mr Rod Moore, Divisional Director of Public Health delivered a presentation on the responsibility for public health in the local authority and answered questions from Members. A copy of the presentation is attached to the minutes for information.

The Chair thanked Mr Moore for his presentation.

Apologies were received from Councillors Grant and Dr. Moore.

Members are asked to declare any interests they may have in the business on the agenda.

Members were asked to declare any interests they may have in the business on the agenda.

Councillor Westley declared an interest in the items of business on the agenda, as he had relatives who were Council tenants.

In accordance with the Council’s Code of Conduct, the interest was not considered so significant that it was likely to prejudice Councillor Westley’s judgement of the public interest. Councillor Westley was not therefore required to withdraw from the meeting during consideration and discussion on the items.

The minutes of the meeting of the Audit and Risk Committee held on 14^th November 2013 are attached and the Committee is asked to confirm them as a correct record.

RESOLVED:

that the minutes of the meeting of the Audit and Risk Committee held on 14^th November 2013 be approved as a correct record.

With agreement the Chair agreed to change the order of the agenda.

The External Auditor submits an Annual Report for the Certification of Grants and Returns. The Committee are asked to note the report.

The External Auditor presented a report that summarised the work of the auditor and findings from the Certification of Grants and Returns 2012/13.

It was reported that for 2012/13 one claim (housing and council tax benefits) with a total value of £170million and three returns (pooling of housing capital receipts; national non-domestic rates; teachers pensions) with a total of £125million were certified. The Headlines outlined certification results and audit adjustments necessary to three of the Council’s grants and returns as a result of certification work. It was reported that the Council had good arrangements for preparing its grants and returns and supported the External Auditor's certification work.

The overall fee for the certification of grants and returns was estimated at £83,534, though £5,328 was still subject to confirmation by the Audit Commission, and consequently the fee information presented was an estimate rather than final figure.

Consideration was given to the remainder of the report, which covered the following areas:

- Summary of certification of work outcomes;

- Fees;

- Recommendations;

- Prior year recommendations.

Members asked how prior year recommendations were being addressed. Members were informed it was not unusual for a local authority to receive a qualified Housing Benefit claim, and that significant resource in quality assurance had been made. Members were told that KPMG recognised the amount of testing asked of authorities by the DWP.

RESOLVED:

1.    that the report be noted.

The External Auditor submits a document that sets out how they will deliver their financial statements audit work for Leicester City Council, and the approach to value for money (VFM) work for 2013/14. The Committee are asked to note the report.

The External Auditor presented a report that set out the detailed audit plan for the external audit of the financial statements and the approach to value for money (VFM) work for the 2013/14 financial year.

Members considered the report in detail, which covered the following areas:

- KPMG's audit approach

- Value for money audit approach

- Audit team, deliverables, timescales and fees.

The stages of KPMG's audit approach were summarised in the report as follows:

- Planning

- Control evaluation

- Substantive procedures

- Other audit work

Members were asked to note the significant risk identified with regards to the Local Government Pension Scheme triennial valuation, and the risk that if the data provided to the actuary for the valuation exercise was inaccurate then such inaccuracies could affect the actuarial figures in the accounts. As part of the audit, KPMG would need to agree the data provided to the actuary back to the systems and report from which it was derived, and test the accuracy of the data. KPMG would liaise with PwC, who were the auditors of the Leicestershire Pension Fund, on the authority’s behalf.

Members were also asked to note the External Auditor’s approach to Value for Money conclusion and audit of the Council's financial statements.

The Chair thanked the External Auditor for the report.

RESOLVED:

1.    that the report be received and noted.

The External Auditor will deliver a presentation from the Audit Commission on Protecting the Public Purse (PPP) 2013 report.

The External Auditor delivered a presentation from the Audit Commission on Protecting the Public Purse (PPP) 2013 report, and a copy is attached to the minutes for information.

Following the presentation, Members asked that subsequent figures on detected cases be brought to a future meeting. They also requested that information on fraudulent activity under the Council’s Blue Badge scheme be brought to a future meeting.

The Chair recommended more training on fraud and risk be delivered to all Councillors to enable to support them in their role as Ward Councillors.

The Chair thanked the External Auditor for the presentation.

RESOLVED:

1.    that the presentation be noted;

2.    that a subsequent update on figures be brought to a future Audit and Risk Committee meeting.

3.    that information on fraudulent activity under the Council’s Blue Badge scheme be brought to a future meeting.

AGENDA

MEMBERS OF THE PUBLIC TO NOTE

Under the law, the Committee is entitled to consider certain items in private where in the circumstances the public interest in maintaining the matter exempt from publication outweighs the public interest in disclosing the information.  Members of the public will be asked to leave the meeting when such items are discussed.

The Committee is recommended to consider the following reports in private on the grounds that they contain ‘exempt’ information as defined by the Local Government (Access to Information) Act 1985, as amended, and consequently that the Sub-Committee makes the following resolution:-

“that the press and public be excluded during consideration of the following reports in accordance with the provisions of Section 100A(4) of the Local Government Act 1972, as amended, because they involve the likely disclosure of 'exempt' information, as defined in the Paragraphs detailed below of Part 1 of Schedule 12A of the Act, and taking all the circumstances into account, it is considered that the public interest in maintaining the information as exempt outweighs the public interest in disclosing the information.”

Paragraph 3

Information relating to the financial or business affairs of any particular person (INCLUDING THE authority holding that information)

INTERNAL AUDIT UPDATE REPORT – 2013-14 QUARTER 3 (OCTOBER 2013 – DECEMBER 2013)                                                                        Appendix B1

RESOLVED:

“that the press and public be excluded during consideration of the following reports in accordance with the provisions of Section 100A(4) of the Local Government Act 1972, as amended, because they involve the likely disclosure of 'exempt' information, as defined in the Paragraphs detailed below of Part 1 of Schedule 12A of the Act, and taking all the circumstances into account, it is considered that the public interest in maintaining the information as exempt outweighs the public interest in disclosing the information.”

Paragraph 3

Information relating to the financial or business affairs of any particular person (INCLUDING THE authority holding that information)

B1)      INTERNAL AUDIT UPDATE REPORT – 2013-14 QUARTER 3 (OCTOBER 2013 – DECEMBER 2013)

The Director of Finance submits a report to the Audit & Risk Committee to provide an overview of audit work planned and completed, significant issues identified by audit work, and management progress in implementing agreed recommendations. The Committee is asked to receive the report and note the key issues identified.

At this point Councillor Westley (Chair) left the meeting. Councillor Naylor (Vice-Chair) took the Chair for the next agenda item.

The Director of Finance submitted a report which summarised Internal Audit’s work completed in the third quarter of 2013-14 (between 1 October 2013 and 31 December 2013) and was presented by the Audit Manager.

The report provided relevant information on the progress made by the Council in implementing recommendations arising from reports issued by Internal Audit, and provided more detail on those Internal Audit reports in which low assurance levels had been given and there were material concerns.

The report provided the Committee with an overview of:

·         audit work planned and completed

·         significant issues identified by audit work

·         management progress in implementing agreed recommendations.

The Audit Manager informed the meeting that the proportion of higher assurance levels continued to increase in the third quarter. The Audit Manager outlined one particular area for concern, and this was discussed with the Audit and Risk Committee Members who were informed that the Assistant Mayor for the area and Chief Operating Officer had been fully briefed. He said Internal Audit would be monitoring the implementation of recommendations made and would report back to the Audit and Risk Committee in due course.

The Chair thanked officers for the update and asked the Committee to note the report.

RESOLVED:

1.    that the report be received.

2.    that the key issues identified be noted

3.    that the progress made in implementing the recommendations in one specific audit report be brought to a future meeting of the Audit and Risk Committee.

Councillor Meghani left the meeting at this point.

A joint report of the Director of Finance, the Director of Environmental Services and the Director of Housing is submitted to Audit & Risk Committee, which provides information on counter-fraud activities between 1 April 2013 and 31 December 2013. The Committee are asked to note the report.

The Director of Finance, the Director of Environmental Services and the Director of Housing presented a joint report that provided information on counter-fraud activities between 1 April 2013 and 31 December 2013. The Director of Finance presented the report.

It was reported that Internal Audit, though not directly responsible for the investigation of suspected financial irregularities, had a role in preventing fraud by recommending improvements to systems and procedures where appropriate. Responsibility for the City Council’s counter-fraud work was shared by the Corporate Counter-Fraud Team, the Revenues and Benefits Investigations Team, both within Financial Services, the Trading Standards Team within Environmental Services, and the Tenancy Fraud Team within Housing Services.

The Committee was recommended to receive the report, and make any recommendations it saw fit either to the Executive or the Director of Finance, Director of Environmental Services or Director of Housing.

The Investigations Manager, Revenue and Benefits informed the meeting that £134,000 in funding was successfully secured from the Department for Communities and Local Government (DCLG), which would be used to support the work of the Tenancy Fraud Team.

It was also reported that plans were underway to start undertaking work with Oadby and Wigston Borough Council and other social landlords within Leicestershire to identify tenancy fraud and bring about criminal proceedings.

The Chair asked if the staff had the time to take on additional work, as there would be problems if too much was taken on, and work within the city would suffer.

The Chair requested that the Director of Housing be invited to a future meeting to discuss procurement fraud in Housing Services in private session.

In response to a question, Members were informed the application for funding from Housing was granted on the proviso that work was done for Oadby and Wigston Borough Council, though the funding was not ring-fenced.

The Chair thanked Officers for the report.

RESOLVED:

1)    that the report be received.

2)      That the Director of Housing be invited to a future meeting in private session to discuss procurement fraud in Housing Services.

The Director of Finance submits a report that provides Committee with the regular update on the work of the Council’s Risk Management and Insurance Services team’s activities.

The Committee is recommended to receive the report and note its contents, and make any recommendations or comments it sees fit either to the Executive or Director of Finance.

The Director of Finance submitted a report which provided the Committee with the regular update on the work of the Council’s Risk Management and Insurance Services Team’s activities. The Head of Internal Audit and Risk Management, presented the report.

Under Insurance and Claims it was reported the Council had lost one case resulting in an award to the claimant of £1,992 and costs of £23,000 against an original reserve of £25,000.

It was also reported the Council had accepted liability in one case and had offered £1,000 prior to a hearing. The claimants did not believe it was enough and during the court case, the judge agreed with the original offer of £1,000, and the claimant had to pay their lawyers costs of £15,000. The Council’s reserve was £19,500 and £18,500 was retained within the insurance fund.

The Head of Internal Audit and Risk Management informed the meeting that plans were in place regarding the forthcoming strike of the two main teaching unions (NUT and NASUWT), and that as many schools would remain open as possible. Parents had been informed.

In response to a question, the Head of Internal Audit and Risk Management informed the meeting that claims from the Loss Reduction Fund were approved by the Operational and Strategic Management Boards, when a full breakdown on each claim was provided.

The Chair thanked the Officer for the report.

RESOLVED:

1.    that the contents of the report be noted.

The Director of Finance presents to Committee the detailed operational audit plan for the fourth quarter for the financial year 2013-14. The Committee is asked to note the report.

The Director of Finance submitted a report which presented the detailed operational audit plan for the fourth quarter of the financial year 2013-14 and was presented by the Audit Manager. The Committee was asked to note the report.

The detailed operational plan for the fourth quarter of 2013-14 was attached to the report, and the Committee was asked to note in particular the following audit areas:

·         Significant financial systems;

·         IT audit;

·         Schools;

·         Children’s Services;

·         Contract audit;

·         Corporate governance, including the Leicestershire Economic Action Plan 2012-2020, and including governance arrangements for Public Health;

·         EMAS.

Members were informed that work would continue on the programme of contract audits looking at individual departments or service areas, plus a follow-up of the previous audit of Housing Contracts, and would be reported back to a future meeting.

The Chair thanked officers for the update and asked the Committee to note the report.

RESOLVED:

1.    that the report be received, and the key issues identified be noted

2.    that the progress made on the programme of contract audits, plus follow-up of the previous audit of Housing Contracts be brought to a future meeting of the Audit and Risk Committee.

The Director of Finance submits a proposed schedule of meetings and their agendas for the Financial Year 2014-15. The Committee is recommended to note and accept the proposed plan content, and raise any issues or questions with the report author or the Director of Finance.

The Head of Internal Audit and Risk Management presented a proposed schedule of meetings and their agendas for the financial year 2014-15. The Committee was recommended to note and accept the proposed plan and content, and raise any issues or questions with the Head of Internal Audit and Risk Management or the Director of Finance.

It was reported that the Annual Calendar of Meetings would be presented to Annual Council.

The Chair and Members at the meeting agreed to the schedule. The dates would be passed to the author of the Annual Calendar for inclusion.

RESOLVED:

1.    that the proposed schedule of meetings be noted.

The meeting closed at 7.14pm.