53.1 None received.

Members are reminded that they must not participate in the discussion or voting on any matter in which they have a Disclosable Pecuniary Interest and should leave the room prior to the commencement of the debate.

54.2The Chairman reminded Members that they must not participate in the discussion or voting on any matter in which they have a Disclosable Pecuniary Interest and should leave the room prior to the commencement of the debate.

The Minutes of the meetings held on the 17 September 2015 are attached for confirmation, marked 3. 

Contact Michelle Dulson (01743) 257719

55.1 It was confirmed that the word ‘contacts’ in the second sentence of paragraph 38.3 should read ‘contracts’.

55.2 RESOLVED:  

        That the minutes of the meetings held on 17 September 2015 be approved and signed by the Chairman as a correct record, subject to the above.

To receive any questions from the public, notice of which has been given in accordance with Procedure Rule 14.

56.1 There were no public questions.

The report of the Revenues and Benefits Service Manager is attached, marked 5. 

Contact Phil Weir (01743) 256113

57.1 The Committee received the report of the Revenues and Benefits Service Manager - copy attached to the signed Minutes - which provided Members with performance monitoring information on the collection of Council Tax and National Non Domestic Rates (Business Rates) income for the year to 31 March 2015, together with progress on the year to 31 March 2016.

57.2The Revenues and Benefits Service Manager reported that the final collection rate for council tax for 2014-15 was 98.3% which compared favourable to the previous year’s collection rate of 98.1%.  In the year to 9 November 2015, 73.7% of council tax had been collected compared to 73.6% for the equivalent period last year.  The total arrears for council tax as at 31 March 2015 stood at £8.6m but as at 1 November 2015 this had reduced to £6.7m.

57.3In respect of Business Rates (NNDR), the Revenues and Benefits Service Manager stated that the final in-year collection rate for 2014/15 was 98.7% which again compared favourably with the previous year’s collection rate of 98.3%.  In the year to 9 November 2015, 75.5% of business rates debt had been collected compared to 73.1% for the equivalent period last year.  The total arrears for Business Rates as at 31 March 2015 stood at £3.4m and as at 1 November 2015 this had reduced to £3m.

57.4 The Revenues and Benefits Service Manager drew attention to the difficulties collecting Council Tax and Business Rates over 12 months as opposed to the usual 10 months.  In response to a query the Revenues and Benefits Service Manager explained that collection rates were slightly ahead of the previous year due in part to Council Tax payers being made aware over a period of time that if they consistently did not pay, the Council would follow this up quickly and attempt to set up a proper recovery timetable etc.

57.5 Concern was raised about the level of aged debts and reference was made to a Central         Government consultation that had been highlighted to members by external audit

        looking at improving the efficiency of collection rates.  The Revenues and Benefits Service Manager was requested to attend a future meeting to discuss the results of this consultation.  He was also requested to expand his analysis in future reports to cover the points raised by Members.

57.6 RESOLVED:  That the contents of the report be noted.

The report of the Head of Finance, Governance and Assurance (Section 151 Officer) is attached, marked 6.

Contact:  James Walton (01743) 255011

58.1 The Committee received the report of the Head of Finance, Governance and Assurance (S151 Officer) – copy attached to the signed Minutes – which informed Members of the Treasury activities of the Council for the first six months of the financial year.  

58.2The Head of Finance, Governance and Assurance (S151 Officer) reported that the internal treasury team had achieved a return of 0.58% on the Council’s cash balances, outperforming the benchmark by 0.22%. The Council currently had £150m held in investments and borrowing of £332m however with interest rates being very low the Council was not getting any benefit from this.

58.3In response to a query, the Head of Finance, Governance and Assurance (S151 Officer) reported that he meets on a monthly basis with the Pension Fund Managers who believed that investor confidence was increasing despite the slow-down in China, which was still a massive economy.

58.4In response to a query about plans to develop a new capital programme, the Head of Finance, Governance and Assurance (Section 151 Officer) explained that over the last three or four years there had generally been a significant slow-down and very little major schemes had been added to the existing capital programme.  He reported that three major schemes had now been identified however no figures had been attached as yet and there were another five large schemes on the horizon.

58.5A query was raised about whether it would be worthwhile the Council paying back some of its borrowing whilst bank interest rates were so low.  The Head of Finance, Governance and Assurance (Section 151 Officer) explained that they regularly looked at re-profiling the Council’s finances however PWLB redemption conditions made it impossible to redeem these loans.  He agreed to include a session on treasury management in the Committees’ next training session.

58.6RESOLVED:

        That the position as set out in the report be accepted and that Members note that any capital schemes brought forward that would impact on the current strategy would need to be approved by Council.

The report of the Engagement Auditor is attached, marked 7.

Contact:  Katie Williams (07584) 217067

59.1The Committee received the report of the Engagement Auditor – copy attached to the signed Minutes – which provided an update on the outcomes of the 2014/15 National Fraud Initiative (NFI), the results of which were reported to and monitored by the Cabinet Office (previously by the Audit Commission) using their secure NFI website.

59.2The Engagement Auditor confirmed that savings of £5,096.53 had been identified so far during the 2014/15 exercise which had reduced significantly compared to 2012/13 due to the transfer of housing benefit fraud investigations to the Single Fraud Investigation Services. 

59.3It was reported that 17 days had been spent investigating the data matches and that the fee for participating in this mandatory exercise for 2014/15 was £3,650.00.  The Engagement Auditor then took members through the significant matches identified and set out at paragraph 6.5 of the report.

59.4In response to a query it was confirmed that the Registrar did have a duty to notify the Local Authority of a death, however the majority of matches were due to a timing issue between the data being submitted and the matches being returned.

59.5The Engagement Auditor explained how the public were informed that their data was used for the purpose of detecting fraud and Members felt that awareness of this ought to be widened.

59.6RESOLVED:

        That the contents of the report be noted.

The report of the Audit Service Manager is attached, marked 8. 

Contact: Ceri Pilawski (01743) 252027

60.1     The Committee received the report of the Audit Service Manager – copy attached to the signed Minutes – which outlined the measures undertaken in the last year to evaluate the potential for the occurrence of fraud and how the Council managed those risks with the aim of prevention, detection and subsequent reporting of fraud and corruption.  It also informed Members that the Counter Fraud, Bribery and Anti-Corruption Strategy had been reviewed in line with best practice and continued to underpin the Council’s commitment to prevent all forms of fraud, bribery and corruption whether it be attempted on or from within the Council, thus demonstrating the strategy’s continuing and important role in the corporate governance and internal control framework.

60.2     The Audit Service Manager confirmed that the Council was meeting the standard set out in the CIPFA Code of Practice on managing the risk of fraud and corruption.  She then drew attention to the main changes identified within the strategy and the revised RIPA Policy.

60.3     AGREED:

            To endorse the measures undertaken and detailed in the report together with the revisions to the Counter Fraud, Bribery and Anti-Corruption Strategy.

The report of the S151 Officer is attached, marked 9.

Contact: James Walton (01743) 255011

61.1The Committee received the report of the S151 Officer – copy attached to the signed Minutes – which set out minor changes being proposed to the Audit Committee Terms of Reference.

61.2It was noted that when the Terms of Reference had been reviewed the previous year the word ‘Members’ had been added to Paragraph 44 however this had been omitted from the Terms of Reference attached at Appendix A.

61.3RESOLVED:

        That the current Audit Committee Terms of Reference be endorsed.

The report of the S151 Officer is attached, marked 10.

Contact: James Walton (01743) 255011

62.1 The Committee received the report of the S151 Officer – copy attached to the signed Minutes – which requested Members to review and comment on the self-assessment questionnaire which allowed them to demonstrate the effectiveness of the Audit Committee and to identify whether there were any further improvements that could be made to improve the Committee’s overall effectiveness.

62.2 The Chairman took the Committee through the self-assessment questionnaire set out at Appendix A to the report.  The Audit Service Manager agreed to share with Members the evidence which backed up the self-assessment responses.  Members agreed that they would revisit the detail behind the Committee’s self-assessment as part of their training every second year.

62.3 RESOLVED: That the self-assessment questionnaire be approved.

The report of the Audit Service Manager is attached, marked 11. 

Contact: Ceri Pilawski (01743) 252027

63.1The Committee received the report of the Audit Service Manager – copy attached to the signed Minutes – which set out the changes being proposed to the Internal Audit Charter.

63.2 RESOLVED:

        That the Internal Audit Charter be endorsed.

The report of the Audit Service Manager is attached, marked 12.

Contact:  Ceri Pilawski (01743) 252027

64.1The Committee received the report of the Audit Service Manager – copy attached to the signed Minutes – which provided Members with an update of the work undertaken by Internal Audit in the two months since the last report in September 2015 and summarised the progress against the Internal Audit Plan.

64.2The Audit Service Manager informed the meeting that 58% of the revised plan had been completed which was in line with the target of 90% by year end.  She reported that twelve good and reasonable assurance opinions had been issued together with eleven limited and one unsatisfactory assurance opinion.  She went on to say that twenty four final reports had been issued which contained 335 recommendations, none of which were fundamental.

64.3The Audit Service Manager explained that the original plan had provided a total of 2,068 days however this had been revised down to 1,939 days due to the resignation of a member of staff and a planned maternity leave from March 2016.  Also, there were changes to the planned activity to include a number of transformation and advisory work projects which were unknown at the time.  She then drew attention to the lower assurance levels in Children’s Services which were considered to be of low risk and would not affect the overall year end opinion and Customer Involvement where the overall assurance and direction of travel remained a concern given the systems’ impact on delivering the Council’s objectives. 

64.4Turning to the Council’s internal control direction of travel, the Audit Service Manager reported that comparison of assurance levels since 2013/14 demonstrated a falling level of overall control (30% good assurance in 2013/14 compared to 8% in 2015/16 to date; and 15% limited assurances in 2013/14 compared to 41% in 2015/16 to date).

64.5The Chairman raised concerns in relation to the Council’s internal control direction of travel, which although not unexpected, he was nonetheless concerned whether other Members of the Council were generally aware that the required standards of control were lower/not being met and he wished for all Members to be made aware that the level of operational assurances were falling.

64.6In response to a query about what was being done about the falling level of assurances, the Audit Service Manager informed the Committee that she had raised this issue with the Directors who recognised it was a consequence of redesign and reducing resources, whilst they were aware and concerned about the direction of travel they felt realistically with the known continuing financial pressures, that the direction of travel may not improve over the short to medium term.

64.7The Section 151 Officer explained that the Directors were concerned about the Direction of Travel and had made a commitment that those areas highlighted as having limited and unsatisfactory assurance levels would be dealt with and additional resources allocated where necessary.  The processes were still effective but the Council was in a period of change and it was felt that things would continue in  ...  view the full minutes text for item 64.

The report of the Engagement Lead is attached, marked 13.

Contact: Mark Stocks (0121) 232 5356

65.1The Committee received the report of the External Auditor – copy attached to the signed Minutes – which summarised the findings arising from the work carried out for the year ended 31 March 2015 in relation to the financial statements of both the Council and the Pension Fund and the Value for Money conclusion.

65.2The External Audit Manager took Members through the report and highlighted the salient points.  She drew attention to the key messages set out on page 7 of the report and confirmed that the fee for 2014/15 was £178,460, excluding VAT.

65.3The Chairman was pleased to note the unqualified opinion given by External Audit.  He commented that Appendix B had been very useful and he was pleased that this would become a regular feature of future External Audit reports.

65.4In response to a query about how achievable the Council’s savings plan was thought to be, following the work done on the Council’s Value for Money conclusion, the External Audit Manager confirmed that the savings plans were felt to be achievable and realistic.  The payback period had been changed slightly however this was part of the Medium Term Financial Plan and as such was accepted as reasonable.  External Audit were aware that there had been some changes to the way Services were being delivered, so not all of the savings were coming through straight away but hopefully they would come through eventually.  She went on to say that the Council still had very healthy reserves during a very uncertain and transitional time and that any concerns would be discussed with Officers.

65.5RESOLVED:

        That the contents of the report be noted.

The report of the Engagement Lead is attached, marked 14.

Contact: Mark Stocks (0121) 232 5356

66.1The Committee received the report of the External Auditor - copy attached to the signed minutes - which provided Members with a report on progress together with a summary of emerging national issues and developments which may be of relevance to the Council. It also included several challenge questions in respect of the emerging issues which the Audit Committee may wish to consider in its future work or training programmes.

66.2The External Audit Manager informed the Committee that the Chief Executive and Section 151 Officer were attending their Birmingham offices the following day to benefit from the CEO room where independent business and public sector experts would be available to discuss where the Council was going strategically.  She also reported that a workshop was being developed to consider devolution for rural areas.

66.3 RESOLVED: 

        That the contents of the report be noted.

The next meeting of the Audit Committee will be held on the 18 February 2016 at 9.30am in the Wilfred Owen Room.

67.1Members were reminded that the next meeting of the Audit Committee would be held on the 18 February 2016 at 9.30am.

To RESOLVE that in accordance with the provision of Schedule 12A of the Local Government Act 1972, and Paragraphs 2, 3 and 7 of the Council’s Access to Information Rules, the public and press be excluded during consideration of the following items.

68.1 RESOLVED:

That in accordance with the provisions of Schedule 12A of the Local Government Act 1972 and paragraph 10.2 of the Council’s Access to Information Procedure Rules, the public and press be excluded during consideration of the following items as defined by the categories specified against them.

The exempt minutes of the meetings held on the 17 September 2015 are attached for confirmation, marked 17. 

Contact Michelle Dulson (01743) 257719

69.1RESOLVED:

That the exempt minutes of the meetings held on 17 September 2015 be approved and signed by the Chairman as a correct record.

The report of the Interim ICT Manager is attached, marked 18.

Contact: Karen Davis (01743) 258616

70.1The Committee received the exempt report of the Interim ICT Manager – copy attached to the signed Minutes - which provided a brief update on the current situation.

70.2 RESOLVED:

        That the contents of the report be noted.

The report of the Engagement Auditor is attached, marked 19.

Contact:  Katie Williams (01743) 252087

71.1The Committee received the exempt report of the Engagement Auditor – copy attached to the signed Minutes – which provided an update on current fraud and special investigations undertaken by Internal Audit and on current Regulation of Investigatory Powers Act (RIPA) activity.

71.2RESOLVED

        That the contents of the report be noted.