Agenda and draft minutes
Venue: Council Chamber, Muriel Matters House, Breeds Place, Hastings, TN34 3UY. Please enter the building via the Tourist Information Centre entrance.
Contact: Emily Horne on 01424 451719 email: email@example.com
Note: The recording of this meeting is available to view online at http://www.hastings.gov.uk/my_council/cm/?video=209369762
Items No. Item
Declarations of Interest
The following Councillors declared their interests in the minutes indicated: -
44. BDO Planning Report to the Audit Committee (Audit for the Year Ended 31 March 2017) - Pension Fund Liability Assumptions
Personal – A member of East Sussex County Council
Apologies for Absence
RESOLVED – (unanimously) that the minutes of the meeting held on 25 January 2017 be approved and signed by the Chair as a true record
The Chief Auditor introduced his report to the Committee and informed members of BDO’s audit plan for the audit of the Council’s accounts and Value for Money arrangements. The BDO report highlights the risk-based approach to the audit and the main risks they have identified. It also shows the proposed audit fees. The BDO Audit Plan to the Audit Committee (Audit for the year ending 31 March 2017) was appended to the report.
Leigh Lloyd-Thomas, Engagement Lead, BDO, presented the plan. He explained the threshold and materiality limits for the audit and the risks estimated and advised of the changes to this year’s report. He referred to the absence of a museum piecewhich for the last two years had been on tour to other museums. He said that its existence needed to be verified because of its value.
The Chartered Institute of Public Finance and Accountancy has changed the way that the statutory accounts will now look. BDO will look at related party transactions and assessing our reserves. BDO’s Engagement Lead said that the Council has significant reserves but we are not receiving enough funding to cover some services and for several years there has been a run on these. There is also committed spend earmarked against reserves. Hastings Borough Council finds a way to use its money wisely, in medium term though; something has to change for the Council’s finances to remain sustainable.
Fees are set by external body that BDO is obliged to follow. BDO’s Engagement Lead said he will bring a report to the committee in mid-September which will cover all of the conclusions from their audit testing.
Councillor Sinden asked how much the museum piece that was loaned on tour had been valued at. The BDO Engagement Lead confirmed the insurance team’s significant valuation of the item. The Assistant Director Financial Services and Revenues added that requisite security measures as advised by our insurer were in place.
Councillor Chowney sought clarification on the red risk highlighted by BDO called management override. The BDO officer explained that towards closure of year end accounts there are necessary adjustments that are proper to be made. However, there is sometimes pressure on management for adjustments to be made that could show the accounts more favourably unless adequate controls are in place. Hence BDO scrutinise all significant adjustments made at year end close down to ensure that the figures and transactions are bonafide.
Councillor Chowney asked if there is anything Hastings Borough Council should be doing that we are not. The BDO Engagement Lead referred to the underlying controls and advised that the quarterly financial report should be in line with expenditure so that the final set stacks up against the quarterly reports. If the final set of accounts look nothing like expectations it will need to be addressed. The Assistant Director Financial Services and Revenues said the revised budget was set in in February and the outcome will be available in July. At that time, any differences ... view the full minutes text for item 62.
The Chief Auditor introduced his report to formally confirm that the internal audit plan for 2017/18 had been noted by the Audit Committee.
Councillor Sinden queried the progress of the car park machines for operating the new coinage. The Chief Auditor advised that Cale Briparc is managing the work to reconfigure the machines. A number of the machines have already been upgraded and reconfigured. Software will advise when the machines are full. The last two upgrades for 5p and 50p coins were successful and there are no problems.
Councillor Chowney asked what the Euro Grant Audit involved. The Chief Auditor said there were a lot of other grants which were not euro grants as well as CAN and Shine that are. The Assistant Director Financial Services and Revenues added that we make provision in the audit plan for euro grant work which covers its costs. It does impact on audit plan but is helpful to have in house experience.
Councillor Rankin asked how the work on Syrian refugees was shared. He said part of the audit plan involves handling large amounts of cash. Controls are there at the beginning before cash is given to refugees, however we need to see the whole system and test how the cash is spent and not past around other people. To see evidence that the money is spent for the purpose it is intended.
Councillor Charman said people will automatically know what they entitled to – leading to a risk of exploitation. The Assistant Director Financial Services and Revenues said that government has provided guidance on housing and spending. Refugees are entitled to £200 in cash for which they sign for. The audit will see if it achieves its objective of balance of funds and how spent. We will determine terms of reference and overall controls and individual controls for protection of staff. It will be a full and thorough audit as the Syrian refugee scheme will last for next 5 years.
Councillor Chowney stated that the refugees cannot get a bank account because they don’t have the credentials. Providing a plastic card to withdraw money is an expensive process. I raise this as something you look at. Having raised this with the local MP/Home Secretary, she said she will look into this.
Councillor Webb asked if Hastings were having these discussions with Credit Union. The Assistant Director Financial Services and Revenues said there was an issue regarding the bank account and universal credit bank account holding up all the payments which their total support depends on, which the council support during that period.
Councillor Chowney said he believes the Credit Union is involved in loading up cards. However, they are a volunteer organisation, and so there is only so much they can do.
Councillor Rankin referred to the services which he felt had a reputation and audit risk - drill down at another meeting. He said he was concerned cash was sent out and not reaching its destination, vulnerable people. It is ... view the full minutes text for item 63.
The Chief Auditor presented his report on the key findings from the payroll audit.
He advised that particular focus was spent on staff mileage claims but there were no concerns to report.
The overall audit assessment was good. The controls were in place and there were no significant audit concerns that needed to be brought to the attention of the committee.
RESOLVED (unanimously) that the Audit Committee accepts the report
The reason for the decision was: To monitor the levels of control within the organisation.
Notification of any additional urgent items (if any)