Agenda and minutes
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Contact: Farhana Zia, Democratic Services Tel: 020 7364 0842, E-mail: farhana.zia@towerhamlets.gov.uk
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DECLARATIONS OF INTEREST PDF 214 KB Members are reminded to consider the categories of interest, identified in the Code of Conduct for Members to determine: whether they have an interest in any agenda item and any action they should take. For further details, see the attached note from the Monitoring Officer.
Members are also reminded to declare the nature of the interest at the earliest opportunity and the agenda item it relates to. Please note that ultimately it is the Members’ responsibility to identify any interests and also update their register of interest form as required by the Code.
If in doubt as to the nature of an interest, you are advised to seek advice prior the meeting by contacting the Monitoring Officer or Democratic Services.
Additional documents: Minutes: No declaration of disclosable pecuniary interest were made by the members. For the record, Councillor Kyrsten Perry stated she is the Chair of the Pensions Committee and Councillor Andrew Wood stated he is a member of the Pensions Committee.
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APPOINTMENT OF VICE CHAIR Additional documents: Minutes: Councillor Dan Tomlinson nominated Cllr David Edgar for the position of vice-chair. The nomination was seconded by Councillor Kyrsten Perry and the Chair, Councillor Val Whitehead. No further nominations were made. The Audit Committee RESOVLED to: 1. Elect Councillor David Edgar as the Vice-Chair of the Audit Committee for 2020-21.
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MINUTES OF THE PREVIOUS MEETING(S) PDF 286 KB To confirm the minutes of the Audit Committee held on the 21st July 2020.
Additional documents: Minutes: The minutes from the previous meeting of 21st July 2020 were agreed as an accurate record of the meeting save for the following amendment to the list of attendees. · Charlotte Webster, Independent person did attend the 21st July 2020 meeting.
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DELOITTE ITEMS FOR CONSIDERATION Additional documents: |
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Deloitte Report to the Audit Committee - Audit Year Ending 31st March 2020 PDF 923 KB Additional documents: Minutes: Mr Jonathan Gooding, external auditor from Deloitte’s presented their report and said this was a status report on the audits relating to 2018/19 and 2019/20. He said progress reports had been presented to the Committee at previous meetings and in summary, neither years audits were complete. He informed members whilst some progress had been made in relation to the 2019/20 audit over the last few weeks, with improvement in the information asked for, progress on the 2018/19 remained limited. Mr Gooding said the report outlined the detail and circumstances surrounding the delays. In response to questions from members the following was noted: · In answer to if Deloitte’s are unable to commit significant junior resource beyond November through to April 2021 and what the likely impact would be on the 2020/21 audit of accounts, Mr Gooding said that due to delays in receiving information, this could impact on the timetable of delivering future audits. He said they had rearranged resources and staff over the past two years, but they had reached a point where they were particularly busy. Mr Gooding said his colleague Mr Fish would continue to support the Council in its endeavour to finalise the audits, over the coming months but this depended on information coming forth. · In reference to page 23 of the agenda, last bullet point, members enquired what had happened to the audit certificates for 2016/17 and 2017/18 from the previous auditors. Mr Bartle said there were a few procedural matters that needed to be dealt with, such as the ‘Letters of representation’. However, these letters had not been signed and therefore the certificates had not been issued. He said the delay was because of some of the challenges relating to the 2018/19 accounts, which also impact the previous accounts. · Mr Gooding confirmed that due to the pandemic, the deadline to submit the Statement of Accounts, had been moved from July to November 2020, for the 2019/20 accounts. He said there were quite a few authorities who were struggling to meet this deadline, but the cohort of authorities who had previous years of accounts to submit was much smaller. Mr Peter Worth confirmed the number to be thirty-four local authorities. The Audit Committee RESOLVED to:
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TOWER HAMLETS ITEMS FOR CONSIDERATION Additional documents: |
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Update on 2018/19 and 2019/20 Accounts and Audit PDF 242 KB Additional documents: Minutes: Mr Kevin Bartle, Interim Divisional Director for Finance, Procurement and Audit briefly outlined the position regarding the 2018/19 and 2019/20 accounts in the public part of the meeting. Mr Bartle said he and his team were very disappointed not to have the accounts finalised for this meeting and regretted this very much. He said the reasons for the delay and the difficulties experienced would be discussed in part two of the agenda when discussing the Independent Review report. Mr Bartle said he hoped to have answers to the queries raised by Deloitte’s, which run into the hundreds by January 2021. On a more positive note, Mr Bartle said the Pensions Fund Accounts were in a relatively good position for both years, with just a handful of outstanding queries which he hoped would be finalised shortly. Members made the following comments in relation to the report: · Councillor Perry, the Chair of the Pensions Committee, briefed members that she had been informed there were two outstanding adjustments to make to the Pension Fund Accounts. She said whilst this was encouraging the bigger issue related to the production of the main accounts. · Councillor Francis stated he appreciated the reasons why some aspects of the production of the accounts were to be taken in private session, however given the issues had been on-going for eighteen months, it was important for the Committee and the officers to publicly explain the reasons for the delay of the 2018/19 accounts. Councillor Francis continued stating some of the issues raised related to wider problems than that of the report commissioned. He said there were issues of governance that need to be addressed and resolved. · The Chair, Councillor Val Whitehead said a report had been commissioned to review independently the reasons for the delay in the production of the 2018/19 accounts and it would not be appropriate to discuss the findings of the report in the public domain. She said it was important for Members to have a frank and open discussion with officers in the private session and for officers to respond to the recommendations made therein. Councillor Whitehead stated that the independent report would be made public in the January agenda papers. · Councillors Perry and Wood stated they concurred with Councillor Francis’ viewpoint, however believed the report at present ought to be discussed privately, in order to solve the issues with the accounts before a public debate.
The Audit Committee RESOVLED to have a fuller discussion in the private session of the meeting and 1. Noted the continuing progress made on, and the plans for completion of the audits for both the 2018/19 and 2019/20 Statement of Accounts.
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Audit Committee Terms of Reference, Membership, Quorum and Dates of Meetings PDF 228 KB Additional documents:
Minutes: Ms Farhana Zia, Senior Committee Officer presented the report, asking members to note the Audit Committee’s terms of reference, membership, quorum and dates of meeting for the municipal year 2020/21.
She informed members these had been agreed at Full Council on the 30th September 2020.
The Audit Committee RESOLVED to:
1. Note its Terms of Reference, Quorum, Membership and Dates of future meetings as set out in Appendices 1, 2 and 3 to this report; and
2. AGREED to hold future meetings of the Audit Committee at 5:30 p.m. if held virtually and at 6:30 p.m. if meetings are held in person at the Town Hall.
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Internal Audit and Anti-Fraud Progress Report PDF 277 KB Additional documents:
Minutes: Mr Paul Rock, Head of Internal Audit, Fraud and Risk presented the Internal Audit and Anti-Fraud progress report. Mr Rock said the report provided an update on the progress against the delivery of the 2019/20 and 2020/21 Annual Audit Plan and highlighted any significant issues since the last report to the Audit Committee in July 2020.
Mr Rock referred members to paragraph 3.2 and said Officers were present at the meeting to answer questions in relation to the three outstanding reports for 2019/20. He said a management response had been received yesterday in relation to the Domiciliary Care audit, which his team would be finalising shortly. He said he also hoped to finalise the Corporate Governance and the Local Community Fund opinions in the coming weeks. Mr Rock continued stating good progress was being made against the 2020/21 Internal Audit Plan and key officers for the six ‘limited’ assurance reports, as outlined in Appendix A, were present at the meeting. Mr Rock said he was particularly pleased with the improvement in the implementation of agreed management actions and said the percentage of fully and partially implemented actions categorised has ‘high priority’ and ‘medium priority’ had increased, when compared with the performance from last year. Referring to Social Housing Fraud, Mr Rock reported a further four properties had been recovered in addition to the seven mentioned in the report. The report also provided an update on the Anti-Bribery Policy which requires review annually. He said minor changes had been made to this. Mr Rock recommended the Anti-Bribery policy be publicised widely in the Council as well as to the members of the public in order to send a strong message to help minimise the risk of bribery. The Chair thanked Mr Rock for his report before inviting the Officers to address their individual reports which were either outstanding awaiting management responses or had received ‘limited’ assurances following Internal Audit’s assessments.
Monitoring of Domiciliary Care Contracts Mr Warwick Tomsett, Joint Director of Integrated Commissioning in the Health, Adults and Communities Directorate presented his response stating that the management response to the internal audit report had now been submitted to Mr Rock. He said all the recommendations therein had been implemented. He said there had been a delay in some of the recommendations being taken forward, especially in relation to contract monitoring and making sure the right performance measures were in place for the contracts. Mr Tomsett described how one of the recommendations in relation to the payment system had resulted in some delay. He said the Electronic Home Care monitoring system was not working effectively and as such the contract was ended with the provider. A simpler system of block payments to care providers was adopted, which is reviewed every six weeks. He informed Members all outstanding issues with the electronic system had now been closed off and outstanding payments had been made to care providers. In response to questions from members the following was noted: · There wasn’t a gap between ... view the full minutes text for item 5.3 |
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Risk Management - Corporate Risk Register PDF 240 KB Additional documents: Minutes: Mr Paul Rock, Head of Internal Audit, Fraud and Risk presented the Risk Management report. He said the Corporate Risk Register had been updated and he was working with all the Directorates to ensure their registers were up to date. Mr Rock said this was an opportunity for the Committee to decide which Directorate level risk register it wanted to review at a future Audit Committee meeting. In response to questions from members the following was noted: · Risk management had witnessed a difficult year with many changes occurring from BDO highlighting concerns, to the remodelling of how the risk management would be taken forward. Mr Rock said this required a strong buy in from the Corporate Leadership Team and just as this was happening the pandemic hit and the only risk resource he had, the Risk Manager, left the Council. Mr Rock said despite these challenges, it was clear risk management had achieved a higher status amongst managers and staff, especially the work done with Gold Command and the response to the pandemic crisis. He said he hoped to capitalise on this by ensuring Directorate Leadership Teams continued to embrace and take ownership of risks in their areas of responsibility. o ACTION: Mr Rock said he would relay the concerns raised back to the risk owners in relation to risk PLC0013. · Mr Rock stated that with the help of the risk champions and business support officers in each Directorate, he was confident to deliver the risk management agenda until the end of the year. However more resource would be required in order to strive ahead. He said he remained hopeful as he was looking to commence a reorganisation of the team. He said the previous recruitment campaign failed to attract the right calibre of candidate.
A brief discussion took place as to which Directorate level risk register ought to be reviewed at the next meeting of the Audit Committee in January 2021. · Members suggested the Place Directorate and the Resources Directorate.
The Audit Committee RESOVLED to:
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Treasury Management Mid-year Report for 2020-21 PDF 629 KB Additional documents: Minutes: This report was taken in conjunction with Item 5.6 Treasury Management report for 2019 -20.
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Treasury Management Report for 2019-20 PDF 637 KB Additional documents: Minutes: Mr Kevin Bartle, Interim Divisional Director for Finance, Procurement and Audit presented both reports. Mr Bartle said he would talk about the 2019/20 report before the mid-year report for 2020/21. He said the reports contained a lot of detail on the treasury management activity that had taken place and therefore he would give assurances around the key indicators. Mr Bartle said all the indicators had been met for the outturn and mid-year Treasury Management reports, as shown in the summaries of the reports. He said the Treasury Management Strategy Statement (TMSS) as approved by Council was being complied with and the Finance Team was keeping a close eye on investment returns because of the bank base rate being at a historic low. He said this could impact significantly on treasury management returns. In respect of credit worthiness of investments, Mr Bartle stated this was at a satisfactory level despite the investment quality being lower than desired. He referred to the pooled investments funds and said the value of these had nominally dropped from £76M to £69.4M. Mr Bartle said that given the fluctuations in the stock markets, due to the pandemic, these long-terms investments have recovered in 2020/21 and are now back up to £73M. Mr Bartle continued stating that from a budget perspective, the targets for income budgets on investment income were being met, despite the difficult time they faced with low interest rates. Lastly Mr Bartle pointed out the Capital Financing Requirement (CFR) had been changed, in line with the changes made to the Capital Programme.
In response to questions from members the following was noted: · Councillor Wood referred to Croydon Council and their Section 114 declaration. He said whilst he appreciated Tower Hamlets was not in the same position, the Committee ought to look at the issues raised. He said there had been a drop in financial investments from March 2019 to September 2020, and whilst the Council was spending more, there was still a lot of money left. He recommended that a future meeting the Audit Committee look at lessons to learnt from the Croydon example. o ACTION: The Chair agreed the Committee would examine the lessons learnt from Croydon Council’s situation at a future meeting. She asked Mr Kevin Bartle, Interim Divisional Director for Finance, Procurement and Audit and Ms Asmat Hussain, Corporate Director for Governance to take this forward.
The Audit Committee RESOVLED to NOTE the recommendations in the Treasury Management Mid-Year Report of 2020-21 in so far as:
AND NOTE the recommendations in the Treasury Management Report 2019-20 in so far as:
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AUDIT COMMITTEE WORK PLAN PDF 196 KB Additional documents: Minutes: The Audit Committee noted the work plan for the remaining meetings of the Committee.
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ANY OTHER BUSINESS THE CHAIR CONSIDERS URGENT Additional documents: Minutes: There was no urgent business to be discussed.
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EXCLUSION OF PRESS & PUBLIC In view of the contents of the remaining items on the agenda the Committee is recommended to adopt the following motion:
“That, under the provisions of Section 100A of the Local Government Act 1972, as amended by the Local Government (Access to Information) Act 1985, the press and public be excluded from the remainder of the meeting for the consideration of the Section Two business on the grounds that it contains information defined as Exempt in Part 1 of Schedule 12A to the Local Government Act, 1972.”
EXEMPT SECTION (Pink Papers) The exempt committee papers in the agenda will contain information, which is commercially, legally or personally sensitive and should not be divulged to third parties. If you do not wish to retain these papers after the meeting, please post them to the Democratic Service Office, 1st Floor, Mulberry Place London E14 3BG or hold onto the papers until such time you can return to the Town Hall and dispose of the papers in the confidential bins.
Additional documents: Minutes: The Chair MOVED and it was: RESOLVED “That, under the provisions of Section 100A of the Local Government Act 1972, as amended by the Local Government (Access to Information) Act 1985, the press and public be excluded from the remainder of the meeting for the consideration of the Section Two business on the grounds that it contains information defined as Exempt in Part 1 of Schedule 12A to the Local Government Act, 1972.”
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Independent Review of Accounts Closure 2018/19 Additional documents:
Minutes: The minute for this item is restricted.
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