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.

There were no declarations of pecuniary interest declared by members of the committee.

To confirm the minutes of the Audit Committee held on 22^nd January 2024.

The Audit Committee RESOLVED:

1.    That the unrestricted minutes of the Audit Committee held on the 22^nd January 2024 be approved and signed by the Chair as a correct record of the proceedings.

Officers from Deloitte were in attendance. Their report was appended at appendix 1 of item 4.1 and they contributed to that item when it was discussed.

Mr Ahsan Khan, Head of Strategic Finance and Chief Accountant presented the backlog report and update on the outstanding accounts of 2020/21, 2021/22 and 2022/23.

Mr Khan explained that the backlog in Local Authority accounts had grown to unacceptable levels and as such the Government published a statement in July 2023 setting out proposals to tackle the local audit backlog. He said organisations involved in the regulation and oversight of local body financial reporting and audit (“system partners”) had been working collectively to agree a proposed solution to clear the outstanding historical audit opinions and ensurethat delays did not return.

He referred to paragraph 3.4 onwards, of the supplementary agenda and said the proposed measures consisted of three phases: Reset, Recovery and Reform. Mr Khan explained to the Committee, what each stage would involve. He said the finance team were focussed on delivering the outstanding accounts by the September 2024 deadline. 

Mr Jonathan Gooding, external auditor from Deloitte said it was vital that the ‘backstop’ dates as mentioned at paragraph 3.7 of the report were met. He said they were making progress and would report back to the Committee as part of the Annual Auditor’s report.

In response to comments and questions from members the following was noted:

·       In response to the tight timetable and what the implications would be, if the deadlines were not met, Mr Gooding stated that sector wide guidance in this regard was evolving. He said that if local authorities did not meet the deadlines, they would be expected to report and explain why.

·       Mr Khan added the finance team would to their utmost to meet the deadlines and said they had reviewed their resources as well as priorities. They were very much focussed on meeting the deadlines and undertake the value for money exercise thereafter. He said they had met with the new auditors EY, who would be appraised of any additional work required.

·       Ms Julie Lorraine, Corporate Director for Resources and Section 151 Officer stated the Government consultation was due to the backlog in public sector audits, which the Government recognised. She said the proposal was to clear the backlog in the most practical way. Resources had been devoted to meet the backstop deadlines and she hoped opinions would be issued by the external auditors soon after. She said ‘as a nation’ it was important to ‘reset’ public sector audits.

The Audit Committee RESOLVED:

1.    To note the summary proposals for addressing the Local Audit Backlog in England

2.    To note Deloitte’s briefing paper to the Council on Plans for Addressing the Backlog in Local Audits (Appendix A)

3.    To note the position on the outstanding external audits of the Council’s Statement of Accounts for 2020/21, 2021/22 and 2022/23

4.    To note the councils latest draft accounts for 2020/21, 2021/22 and 2022/23 (Appendix B, C and D respectively)

Mr David Dobbs, Head of Internal Audit, Anti-Fraud and Risk, introduced the report and stated that the Internal Audit Plan and Charter for financial year 2024 -25 was attached to the report for the Committee to review and agree.

He said the Audit plan appended at appendix 1 provided an explanation of the methodology used and listed the planned audits for 2024/25 at page 25 of the agenda. Planned school audits were listed on page 27. He said he had taken on board the suggestions made by the Committee last year and had consulted a wide range of stakeholders including the Senior Leadership Team.

In response to comments and questions the following was noted:

·       Mr Dobbs said the range and quantity of planned audits was deliverable by the team and said various stakeholders include the Institute of Internal Auditors had been consulted.

·       Councillor Blake asked if the two audits highlighted at the January 2024 meeting – ‘Management of Lettings’ and ‘Management of Markets – Follow up’ were to be brought back to the Committee. Mr Dobbs replied they would be brought to the Committee if they achieved a ‘limited assurance report’. He said he was happy to make available to the Committee the full reports of any audits, members were interested in.

The Audit Committee RESOLVED to:

1.    Agree the Internal Audit plan and Charter for 2024-25 attached at Appendix A.

Mr David Dobbs, Head of Internal Audit, Anti-Fraud and Risk introduced the report and stated the report provided an update on the progress made against the delivery of the 2023-24 Annual Internal Audit Plan. The report also provided an update on the investigation activity, fraud prevention and anti-fraud work. Mr Dobbs referred members to paragraph 3.1 and the appendix attached to the report and said 47% of audit opinions had resulted in Reasonable or Substantial assurance compared to 65% for year 2022-23. He said this was an interim figure and was subject to change.

Mr Dobbs stated that officers were present at the meeting to answer questions relating to the limited assurance reports.

·       Scheme of Publication

·       Attendance Management

·       RFQ Process

In response to comments and questions from members the following was noted:

·       Referring to Appendix A of the report and the ‘advisory’ opinion, Mr Dobbs explained the opinion was likely to change if the service improved their policies and procedures. He said it was necessary to ensure a balanced opinion was given.

·       In response to the ‘limited assurance’ cited on page 45 for Malmesbury Primary School, Mr Dobbs said that the internal audit team would be working with the school’s finance team to address the weaknesses identified.

·       Referring to the Attendance Management limited assurance report, Ms Lorraine, Corporate Director for Resources and Section 151 Officer said accountability for attendance was the responsibility of the manager and the service - and not HR. She said they were looking to have software in place which would make it easier for staff members to report absence and for managers to record absence.

·       Ms Julie Lorraine, Corporate Director for Resources and Section 151 Officer said there had been a review of the RFQ Process and the procurement thresholds used internally. An independent review had been undertaken to review the thresholds so there was less burden on budget holders to approve thresholds less than a £100,000. She said CIPFA recommendations had been taken into consideration.

·       In answer to if staff training was provided for the RFQ process, Mr Dobbs confirmed it was however said this would need to be reviewed in light of the suggested changes.

o   ACTION: When asked if there was an action plan for the recommended changes, Mr Dobbs said this would be circulated to the Committee.

The Audit Committee RESOLVED to:

1.    Note the contents of the attached report and the overall progress and assurance opinions for audits carried out as part of the 2023-24 Audit Plan.

Mr David Dobbs, Head of Internal Audit, Anti-Fraud and Risk, introduced the Risk Management report and said the Corporate Risk Register (Appendix A) and the risk register for Health and Social Care Directorate (Appendix B) were attached to the report. He referred members to paragraph 3.4 of the report and said three new risks had been identified for the Corporate Risk Register. He said Officers from the Health and Social Care Directorate were in attendance to answer questions relating to their risk register.

In response to comments and questions from members the following was noted:

·       Councillor Kabir Ahmed requested the column for responsibility be updated to show the interim Corporate Director for Health and Social Care rather than the Corporate Director who had left the Council. Mr Dobbs said this would be updated in due course, as the information at the time of publication was correct.

·       Mr Dobbs confirmed he was working with services who had recently come ‘in house’ such as Tower Hamlets Homes to fill gaps in using the JCAD system and to identify risks.

·       Mr Somen Banerjee, Interim Corporate Director of Health and Social Care Directorate said their risk register was in reasonable shape as they continued to use the methodology and processes adopted by the previous Director. Mr Warwick Tomsett, Joint Director for Integrated Commissioning, added they followed a regular cycle of review and discussion of risks.

·       Mr Dobbs said the ownership of risks lied with the risk owner who was either the Head of Service or the Corporate Director.

o   ACTION: Mr Dobbs said he would bring to the July meeting the Risk Management Annual Report including detailsof how current and target risks had changed over a period. He said the software was able to produce this information.

The Audit Committee RESOLVED to:

1.    Note the updated Corporate Risk Register and where applicable, request risk owner(s) with risks requiring further scrutiny to provide a detailed update on the treatment and mitigation of those risks including impact on the corporate objectives at the next Audit Committee meeting (or separately before the meeting, if urgent).

2.    Note the proposed changes to the Council’s risk registers, as set out in paragraphs 3.4 and 3.5.

3.    Note the updated Health and Social Care Directorate Risk Register and where applicable request risk owner(s) with risks requiring further scrutiny to provide a detailed update on the treatment and mitigation of their risks including impact on the directorate’s objectives at the next Audit Committee meeting (or separately before the meeting if urgent).

Mr David Dobbs, Head of Internal Audit, Anti-Fraud and Risk said the report recommended the Audit Committee to note and approve the updated Anti-Bribery policy. He said the policy had to be reviewed annually and formed part of the Council’s Fraud and Risk Management arrangements.

In response to comments and questions from members the following was noted:

·       Mr Dobbs said training on Anti-Bribery and Fraud was part of the mandatory corporate training programme and the scenarios used in the training were updated and refreshed. He said new joiners were expected to complete this training as part of their e-learning programme.

The Audit Committee RESOLVED to:

1.    Note and approve the Council’s updated Anti-Bribery policy (Appendix A)

Members of the Audit Committee noted the Committee work plan.

The Chair, Councillor Harun Miah informed members there would be a new workplan for the Audit Committee for 2024-25, at the start of the new municipal year.

There was no other business to be discussed by the Committee.