Venue: Civic Hall, Leeds, LS1 1UR
Contact: Debbie Oldham 0113 37 88656
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Election of Chair
The clerk opened the meeting and informed the Members that the Chair had given her apologies. The Chair had nominated Cllr Wray as the Chair during her absence.
The clerk asked if all Members were agreeable to this.
RESOLVED – To elect Cllr Wray to the Chair for the duration of the meeting.
On taking the Chair Cllr Wray made the following statement saying:
‘He is the Deputy Executive Member supporting Cllr Coupar for Strategy and Resources. He said he would be looking at the conversations impartially from a non-political perspective. He reminded Members that there were no politics with a big ‘P’ at this Committee. This Committee was to consider and scrutinise the procedures and structures of how the Council operates’.
Appeals Against Refusal of Inspection of Documents
To consider any appeals in accordance with Procedure Rule 15.2 of the Access to Information Procedure Rules (in the event of an Appeal the press and public will be excluded).
(*In accordance with Procedure Rule 15.2, written notice of an appeal must be received by the Head of Governance Services at least 24 hours before the meeting)
There were no appeals against refusal of inspection of documents.
Exempt Information - Possible Exclusion of the Press and Public
1 To highlight reports or appendices which officers have identified as containing exempt information, and where officers consider that the public interest in maintaining the exemption outweighs the public interest in disclosing the information, for the reasons outlined in the report.
2 To consider whether or not to accept the officers recommendation in respect of the above information.
3 If so, to formally pass the following resolution:-
RESOLVED – That the press and public be excluded from the meeting during consideration of the following parts of the agenda designated as containing exempt information on the grounds that it is likely, in view of the nature of the business to be transacted or the nature of the proceedings, that if members of the press and public were present there would be disclosure to them of exempt information, as follows:-
There were no exempt items.
To identify items which have been admitted to the agenda by the Chair for consideration
(The special circumstances shall be specified in the minutes)
There were no formal late items. However, there were supplementary items in relation to Agenda Items 9 and 11 which had been circulated to all Members prior to the meeting.
Declaration of Interests
To disclose or draw attention to any interests in accordance with Leeds City Council’s ‘Councillor Code of Conduct’.
No declarations of interests were made at the meeting.
Apologies for Absence
Apologies for absence were received from Cllrs France-Mir and Cllr Almas.
Cllr R Jones attended the meeting as substitute for Cllr Almass.
To approve the minutes of the previous meeting held 26th June 2023 as a correct record.
RESOLVED – That the minutes of the meeting held on 26th June 2023, be approved as a correct record.
Matters Arising From The Minutes
Minute 8 Internal Audit Update Report
In relation to questions from Members on Key Decisions and Counter Fraud Arrangements information had been circulated to Members on Friday 21st July.
Matters outstanding from previous meetings:
· Query on IR35 had now been completed and responded to.
· Privilege Users Access list was now in final stages of agreeing a response and would be circulated to Members very soon.
Members were of the view that the function of Information and Digital Services (IDS) were spoken of a lot in this Committee, and it was suggested that a report should be put before the appropriate Scrutiny Board. It was noted that the point was a valid one and it was the view that it was essential for IDS to attend a meeting of Corporate Governance and Audit Committee and the relevant Scrutiny Board.
To consider the report of the Senior Head of Internal Audit, Corporate Governance & Insurance which sets out the annual opinion of the Head of Audit and provides a source of assurance that the internal control environment is operating as intended through a summary of the Internal Audit activity for the 2022/23 Internal Audit plan. The report also highlights the incidence of any significant control failings or weaknesses
The report of Senior Head of Internal Audit, Corporate Governance & Insurance set out the annual opinion of the Senior Head of Internal Audit and provided a source of assurance that the internal control environment is well established and operating effectively in practice through a summary of the Internal Audit activity for the 2022/23 Internal Audit plan.
Members were provided with the following information:
· It was noted that Appendix C of the submitted report provided a list of work completed by Internal Audit for 2022/23.
· It was acknowledged that the service had been through a challenging year and had undergone a restructure with key officer posts changing.
· The Senior Head of Internal Audit assured the Members that he was confident in the assurances within the report that support the annual opinion.
· Members noted that the opinion remained satisfactory, and this was a testament to the work of officers across the organisation in challenging circumstances.
· During the year the Service had identified areas of opportunity and weakness which could be improved. It was noted that there were also positives to be drawn on from the audits and highlighted at the last meeting in relation to the work being undertaken around culture of the organisation.
· Appendix B of the report summarised Internal Audit resources and the quality assurance and improvement plan for 2022-23. It was noted that there was an external inspection of these areas and it had received certification since 1998. It was the view that this showed the effectiveness of the service to deliver a good quality management system and product and deliver in line with the standards required.
· Excellent feedback had been received in relation to the questionnaires raised at the conclusion of the audit process. The Service was looking to streamline and simplify the feedback, to encourage greater feedback in the future. It was also noted that excellent feedback had been provided informally through the audit process which gave the confidence to say that the service was well respected and valued across the organisation for the positive and constructive challenge that the service offered.
· The Senior Head of Internal Audit took the opportunity to thank the new Chair of the Committee, and the previous Chair and all the Members who sat on the Committee during the year for their constructive challenge. He also thanked officers from across the authority for engaging in the internal audit process, and it was recognised that this was not easy when resources were stretched, but there had been positive engagement to complete the planned work. Thanks, were also given to the Internal Audit and Corporate Governance team for their work to support the delivery of the opinion.
In response to questions from the Committee the Members were provided with the following information:
· Clarification was provided on the table in relation to the recommendation tracker and reasons why some actions had not been progressed. It was noted that the service would be undertaking a sampling process over the coming year, but the onus was on ... view the full minutes text for item 22.
To consider the report of the Chief Officer, Financial Services, presenting the draft Statement of Accounts for 2022/23 for information. The report notes that the draft accounts will be approved by the Chief Officer, Financial Services and will be available for the statutory public inspection period on the council’s website. The accounts will be subject to audit by Grant Thornton over the autumn and winter, and it is anticipated that the final audited accounts will be presented to the committee for approval in February.
The Chief Officer Financial Services submitted a report which presented the draft unaudited 2022/23 Statement of Accounts which would be made available on the Council’s website for public inspection for thirty working days commencing Monday, 24th July 2023. Details of the roles, responsibilities and timescales for approving the statement of accounts were set out in the submitted report.
The Head of Finance presented the report providing the following information:
· Draft Statement of Accounts for 2022-23 had been approved by the S151 Officer on Friday 21st July and were provided to the Committee for information. Members were advised that the draft Statement of Accounts had been published on the Councils website on Monday 24th July, for the public to view them and make any requests for information or make objections to the auditors.
· Members were made aware that the statutory deadline for the draft accounts had been brought forward by Government to 31st May 2023. It was noted that 70% of local authorities were not in a position to publish their draft accounts by 31st May, and the Council was therefore not unusual in publishing its 2022/23 draft accounts later than the statutory deadline. A notice had been published on the Council’s website explaining the reasons that the date of 31st May had not been met and giving the expected timescales for publication.
· The audit of the accounts would be carried out by Grant Thornton, it was expected that the audit would start in Autumn, with the final audited accounts ready to be brought back to the Committee in March 2024 where the Committee would be asked to approve the final accounts on behalf of the Council.
· The Committee were advised that an informal meeting would be arranged in advance of the March meeting with a briefing session so Members could go into the accounts in more detail.
· Members were informed that the 2021-22 audit of the final accounts was expected to be brought to the Committee in September for approval. Members were advised that an informal briefing session would be arranged for the Committee Members in early September where Members could go through the 2021-22 accounts in more detail.
· The Committee were informed that the biggest impact on the accounts for 2022-23 had been the pension position due to the way the pensions liabilities are measured, discounted based on corporate bond rates. As the yield on the bond rates had increased significantly during the year, the Council’s liabilities value had decreased as reported in the accounts. It was noted that the Council has a net pension asset on its West Yorkshire Pension Fund which has not happened before. Members noted this impact was on un-spendable reserves and did not affect funding or future contributions to the pension fund as these would be based on the tri-annual reviews.
· Spendable reserves had reduced during the year, including due to a £12.4m overspend against the budget. It was noted that part of the reduction in reserves was due to funding that had been ... view the full minutes text for item 23.
To consider the report of the Chief Officer, Financial Services, which supports the fulfilment of the Council’s statutory duty to review its system of Internal Control, and to produce an annual governance statement. The report documents the review of Internal Control in the form of the corporate governance framework and assurance map (attached as Appendix A) and includes the Interim Annual Governance Statement (attached as Appendix B).
The Chief Officer Financial Services submitted a report which presented the interim Annual Governance Statement (AGS). Members noted the interim Annual Governance Statement was prepared following a review of the effectiveness of the Council’s arrangements for Internal Control and would be published alongside the Statement of Accounts when put on deposit. Members were informed the final Annual Governance Statement would be brought back to the Committee in Autumn for formal approval in advance of the Committee’s approval of the audited Statement of Accounts.
The Senior Head of Internal Audit thanked the people involved in producing the Annual Governance Statement.
The Committee were of the view that this was a good piece of work, which allowed Members to see specifics and could be used as a working document.
RESOLVED – To note the content of the Report.
The report of the Chief Finance Officer presents Grant Thornton’s Interim Audit Findings Report for their audit of the Council’s 2021/22 statement of accounts. The report outlines Grant Thornton’s findings to date, and the areas which remain to be covered when their audit work resumes.
The report of the Chief Finance Officer presented Grant Thornton’s Interim Audit Findings Report for their audit of the Council’s 2021/22 statement of accounts. The report was sent to Members as a supplementary document. The report outlined Grant Thornton’s findings to date, and the areas which remain to be covered when their audit work resumes.
The Committee were informed of the following:
· The work had commenced in March 2023 and is ongoing with approximately 70% completed and a revised version of the submitted report would be brought to the Committee in September. It was noted that to date the auditors had not identified any audit adjustments impacting on the Council’s outturn position and useable reserves.
· A summary of the findings was set out in Section 2 of the submitted report.
· Two audit recommendations had been raised for management in the Action Plan set out at Appendix A.
· A follow up on recommendations from the previous year were detailed at Appendix B.
· To date a number of identified disclosure and presentational audit adjustments had been identified and were set out at Appendix C.
· There were elements still outstanding, and these were listed on page 5 of the submitted report.
· It was recognised that under ISA(UK)260 there is a non-rebuttable presumed risk that the risk of management over-ride of controls is present in all entities. It was noted that no risks had been identified so far.
· Grant Thornton highlighted the valuation of land and building estimated at £5bn and their suggestion in the previous year to value the land and buildings on 31st March rather than on 1st January. It was noted that management had consulted on this with the Council’s valuers as agreed. However, the 2021-22 valuation date remains the same and a change in valuation date has been recommended again.
· Members noted that the year-end MRP charge has increased to 2.5%.
· Workshops for finance officers had been undertaken and it was the view that these workshops would improve the content and quality of working papers going forward.
Questions from Members provided the following response:
· There were practical issues to consider in relation to changing the valuation date of assets to 31st March. It takes a significant time for the valuations to be undertaken and moving to the 31st March would not leave enough time to complete the draft accounts if valuations were to be based on data for conditions at 31st March. Members queried what approach is taken by comparable authorities with a similar portfolio to Leeds. It was noted that Grant Thornton act as auditors for other core cities and they offered to take this question away and report back.
· Officers were of the view that it would not be permissible under the Code to split the valuation date for half the properties to be valued at 1st January and half valued at 31st March, as it was thought that one valuation date had to be specified. This information was to be checked and reported back.
· Information ... view the full minutes text for item 25.
The report of the Chief Officer Financial Services presents the work programme for the Corporate Governance and Audit Committee, setting out future business for the Committee’s agenda, together with details of when items will be presented.
The report of the Chief Officer Financial Services presented the work programme for the Corporate Governance and Audit Committee, setting out future business for the Committee’s agenda, together with details of when items will be presented.
In relation to the Development Programme presented at the previous meeting, it was noted that training dates and briefing sessions were to be arranged for Members.
The Head of Information Management and Governance informed the Committee that they had been contacted by the Information Commissioners Office (ICO) who wanted to do a data protection audit. Members were advised that not all the details had been provided yet, but in the first week of September would be meeting with the Council to do the scoping for the audit, setting out the areas of the Council they wished to audit. Once specific details have been provided the Council would be given a few weeks to gather evidence. The ICO would start the audit in the first week of November. It was noted that the ICO do hybrid audits but would also be on site conducting interviews with staff. At the conclusion of the audit, a report would be produced within two weeks on their findings, with the Council being given a similar period of time to respond.
Information Governance are due to report to the Committee in February and will provide an update to the Committee on the ICO findings.
RESOLVED – To note and approve the work programme and meeting dates as at Appendix 1.
Date and Time of Next Meeting
To note the date and time of the next meeting as Monday 25th September 2023 at 10.30 am.
RESOLVED – To note the next meeting of the Corporate Governance and Audit Committee is scheduled for Monday 25th September 2023 at 10.30am.
Meeting concluded at 11:45