Agenda and minutes

Apologies were submitted on behalf of Councillors Ray Jelf and Caroline Newton.

To approve the minutes of the meeting held on 16 January 2013 (AG3) and to receive information arising from them.

The Minutes of the meeting held on 16 January 2013 were approved and signed.

On Minute 9/13 Peter Clark informed the Committee that the Department for Communities and Local Government had confirmed the view taken at the last meeting that no dispensation was needed with regard to the setting of the Council budget.

2:10

Report by the Chief Internal Auditor (AG5).

The information contained in the report and annex is exempt in that it falls within the following prescribed category:

3 – information relating to the financial or business affairs of any particular person (including the authority holding that information)

It is considered that in this case the public interest in maintaining the exemption outweighs the public interest in disclosing the information, in that such disclosure would distort the proper process of the transaction and the Council’s standing generally in relation to such transactions in future, to the detriment of the Council’s ability properly to discharge its fiduciary and other duties as a public authority.

This is the report of the Audit Working Group meeting on 4 April 2013. It sets out the matters for reporting to the Audit & Governance Committee relating to the Item AWG3 "The Future of Adult Social Care"

The Committee is RECOMMENDED to:

(a)             task the Audit Working Group with reviewing the detailed improvement plan at the meeting on 20 June 2013;

(b)            receive regular updates on progress with the implementation plan;

(c)             task the Audit Working Group with receiving regular briefings on the design of new systems and procedures arising from the implementation of the improvement plan.

2:30

Report by the Chief Internal Auditor (AG6).

The report summarises the matters arising at the meetings of Audit Working Group on 14 February and 4 April 2013.

The Committee is RECOMMENDED to note the reports and approve the Audit Working Group terms of reference.

The Committee considered a report (AG6) which summarised the main business items arising at the most recent meetings of the Audit Working Group on 14 February and 4 April 2013, which were as follows:

Procure to Pay Project

Review of AWG Terms of Reference

Internal Audit Progress Report

AGS Actions

Whistleblowing Incidents 2012/13

The Audit & Governance Committee noted that the AWG Work Plan would need to be amended to reflect the decision at Minute 15/13. Ian Dyson advised that on the CEF Contract Management Audit the dates had changed in line with the delivery of the project and this had been notified to the CIA in accordance to procedures and he apologised that this had been erroneously reported.

During discussion of the AWG Terms of Reference it was confirmed that the Audit & Governance Committee had the authority to agree them and that there was nothing to prevent a further review and changes being made once the Committee was reappointed.

RESOLVED:             to note the reports and approve the Audit Working Group terms of reference.

2:50

A representative of Ernst & Young will attend for these items

·            Oxfordshire County Council Audit Plan Year End 2013 (AG7(a))

·            Oxfordshire County Council Pension Fund Audit Plan Year End 2013 (AG7(b))

·            Oxfordshire County Council and Oxfordshire County Council Pension Fund Audit Progress Reports (AG7(c));

·           Ernst and Young Letter to Those Charged with Governance  (AG7(d)).

Note:   Reports AG7(a) – (d) to follow

The Committee is RECOMMENDED to note the reports.

The Audit & Governance Committee considered the following reports

·           Oxfordshire County Council Audit Plan Year End 2013 (AG7(a))

·           Oxfordshire County Council Pension Fund Audit Plan Year End 2013 (AG7(b))

·           Oxfordshire County Council and Oxfordshire County Council Pension Fund Audit Progress Reports (AG7(c));

·           Ernst and Young Letter to Those Charged with Governance (AG7(d)).

Maria Grindley, Ernst & Young explained the context of the reports. Mary Fetigan referred to the risk diagram on page 43 of the agenda and highlighted academies as a significant risk that The County Council was aware of and working on. Other areas of risk identified included: changes to business rates and misstatement due to fraud and error. She added that the misstatement due to fraud and error was in all plans as a duty on them as auditors but she was not aware of any key issues at the moment. Going forward they would make more use of IT and analytic tools.

During consideration of the report Audit & Governance Committee noted that the key issue around academies was for the accuracy of accounts. The Committee.

RESOLVED:             to note the reports and that the Chairman would respond to the letter at (d).

3:10

This report sets out the Internal Audit Strategy, including the resources available and how the service will be delivered in 2013/14. Work plans will be prepared on a quarterly basis and will be presented to the Audit Committee for approval. The work plan for Q1 is attached as an Appendix to the report.

The Committee is RECOMMENDED to approve the Internal Audit Strategy and the Q1 Work Plan.

The Audit & Governance Committee had before them a report setting out the Internal Audit Strategy, including the resources available and how the service will be delivered in 2013/14. The Committee noted that work plans would be prepared on a quarterly basis and the work plan for Quarter 1 was attached as an Appendix to the report.

Ian Dyson introduced the contents of the report drawing attention to the assurance mapping exercise to ensure the Committee was getting an assurance for all key services within the County Council, initially focussing on CEF. Work would continue with contract audit and with the Commercial Services Board. Fraud remained a key priority. Ian Dyson responded to queries from members on individual work streams and use of resources.

The Committee is RECOMMENDED to approve the Internal Audit Strategy and the Q1 Work Plan.

3:30

Report by the Monitoring Officer (AG9)

This report provides a commentary on the performance of the Internal Audit system throughout 2012/13, and will be used as a source of evidence when compiling the Annual Governance Statement.

The Committee is RECOMMENDED to approve the Monitoring Officer’s assessment of the effectiveness of the system of Internal Audit 2012/13.

The Audit & Governance Committee received a commentary on the performance of the Internal Audit system throughout 2012/13, that would be used as a source of evidence when compiling the Annual Governance Statement.

Peter Clark introduced the contents of the report highlighting that there had been a 100% return. The conclusion from the responses was that the Internal Audit service was seen as independent but willing to listen. Ian Dyson added that he was pleased with the report and felt that the comments were fair.

During discussion the following points were made:

(1) A member sympathised with the comment on page 108 of the report relating to the use of terms such as ‘adequate’ that had a plain English meaning that differed to its use for audit purposes.

(2) Ian Dyson responding to a comment that it was difficult to sort the priority for actions replied that it was something that could be looked at. There was an exit meeting process following a review and it was accepted that on materiality it was possible for their to be differences. Officers were given every opportunity to disagree with the priorities but as the Chief Internal Auditor he was the final arbitrator.

(3) In response to a query the Committee was advised that there were other indicators in addition to those named at paragraph 19.

(4) It was the service manager’s responsibility to take recommendations forward.

RESOLVED:             to approve the Monitoring Officer’s assessment of the effectiveness of the system of Internal Audit 2012/13.

3:50

Report by the Assistant Chief Executive and Chief Finance Officer (AG10)

The report sets out a proposal for a Risk Management Framework to be adopted across Oxfordshire County Council.

The Council have implemented a risk management process that is well implementedand widely used. Last year, Zurich carried out a health check on our processes and procedures. Included in the report were recommendations to refresh the corporate strategy and to further embed risk management, together with business management and monitoring, across the organisation.

The refreshed Risk Management Framework sets out how the Council will continue to mature and embed its risk management approach.

The Audit & Governance Committee is RECOMMENDED to agree the draft Risk Management Framework for use across Oxfordshire County Council.

The Audit & Governance Committee had before them a report that set out a proposal for a Risk Management Framework to be adopted across Oxfordshire County Council.

Claire Phillips introduced the contents of the report and explained that

a key recommendation of the  Zurich review  had been to separate the policy from the guidance and this had been done in the refreshed Framework. The Framework was not substantially different but was simpler and more engaging. The Directorate Guides were aimed at getting away from a document led process.

During discussion the Committee considered how they would want to understand how the risk management process was being applied in each Directorate. They were advised that there would be regular reports to the Audit Working Group on the toolkits and guides by Directorate and this would enable the Committee to highlight variances and issues.

RESOLVED:             to agree the draft Risk Management Framework for use across Oxfordshire County Council, subject to any significant changes made during the remainder of the process being reported back to the Committee.

4:10

Officers will provide the Committee with a progress report on the management actions arising out of last year’s unacceptable procure to pay audit report.  These actions were included in the Purchasing Improvement Project run with the support of external consultants CMC, which was due to conclude at the end of March.  This progress report will highlight key issues arising during the project, the work still outstanding and revised timescales for its completion.  The format of future monitoring reports, including targets where currently set, will be available, alongside a commentary as to the achievability of these targets against the September 2013 deadline.

The Committee is RECOMMENDED to note the report.

Noted update. Briefing note to be circulated to Committee Members and to include project dashboard. Any questions arising from the note  to be sent to Ian Dyson who will circulate response. Item to be included on June Audit Working Group agenda in June 2013 with a further progress report to this Committee in November 2013.

4:30

To review/update the Committee’s Work Programme (AG12).

The Committee considered its Work Programme (AG12).

RESOLVED: to adopt the Work Programme subject to the following additions:

14 May – Committee to consider appointing  Audit Working Group and Appeals and Tribunals Sub-Committee.

3 July – County Solicitor and Monitoring Officer to produce a report for consideration at this Committee and Performance Scrutiny Committee looking at possible options for the way in which the two Committees can complement one another’s work.

20 November – Procure to Pay Project Update