Agenda and 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: firstname.lastname@example.org
Note: The recording of this meeting is available to view online at www.hastings.gov.uk/my_council/cm/?video=207115015
Items No. Item
Declarations of Interest
Apologies for Absence
RESOLVED – (unanimously) that the minutes of the meeting held on 22 September 2016 be approved and signed by the Chair as a true record
The Assistant Director, Financial Services and Revenues, submitted a report to seek authorisation to opt into the national public sector scheme for the appointment of external auditors.
The report was presented by the Chief Auditor; he advised that there were two options for the appointment of the external auditors. The first option is for the Council to procure its own auditors which would require an auditor panel consisting of 3 independent panel members, costs and administration would apply, or to opt into the public sector arrangement, which will be less resource intensive and is the preferred option for the majority of local authorities.
In regard to the first option: the Council setting up a local trading company, Councillor Rankin asked what the effect will be on local trading companies being audited? The Chief Auditor advised that they would get the best deal locally as with the Foreshore Trust. The Assistant Director, Financial Services and Revenues added that the current process is to go to tender, costs for the audit of the Foreshore Trust is some £3,000p.a.
Councillor Rankin asked officers if the 5year period was effective value for money and whether it is possible to withdraw from the scheme and to make our own arrangements if necessary? The Assistant Director, Financial Services and Revenues informed the committee that the Council would be locked into the agreement for 5 years.
Councillor Rankin asked if there were any projections on savings and were these guaranteed to be cost effective? The Assistant Director, Financial Services and Revenues said there had been significant reductions to date. The last tender exercise for the provision of external audit services saw the level of core audit fees for Hastings Borough Council reduce in stages from some £107,000 in 2011/2012 to £46,000 currently. We are not expecting any future savings but are hoping for cost containment.
RESOLVED (unanimously) to recommend to Full Council that this Council opts in to the appointing person arrangements made by Public Sector Audit Appointments (PSAA) for the appointment of external auditors.
The reason for this decision was:
An external auditor for the audit of the accounts for 2018/2019 must be appointed before the end of 2017. The decision of Full Council is required.
The Assistant Director, Financial Services and Revenues, submitted a report to consider the draft Treasury Management and Annual Investment Strategy and draw any concerns or recommendations to Cabinet and Council as appropriate, to ensure that there is an effective framework for the management of the Council’s investments, cash flows and borrowing activities. The Council has £20.5million of debt, and investments which fluctuate between some £15million and £30million in the year.
There is a statutory requirement to determine, by full Council, the Treasury Management Strategy Statement, Minimum Revenue Provision (MRP) Policy and Annual Investment Strategy (2017/18) prior to the start of the new financial year.
The report was set out in accordance with the Chartered Institute of Public Finance and Accountancy’s (CIPFA) Code of Practice on Treasury Management.
The Assistant Director, Financial Services & Revenues presented his report, he advised of an amendment to the report title. The title should read Treasury Management and Annual Investment Strategy 2017/18, including quarterly monitoring reports for 2016/17. Not “ …monitoring reports 2017/18” as stated in the title.
The Assistant Director, Financial Services & Revenues confirmed that members had attended the Treasury Management Seminar on 10th January 2017 facilitated by Richard Bason, Regional Director, Capita. He referred to the changes in this year’s strategy and said that there will be potential to invest in property management funds. With higher authorised borrowing limits we can take forward the income generation policy and if we hold off asset sales and look at sites, we can borrow more in the short term while the interest rates are still at low level. We are underfunded at the moment effectively meaning we can borrow £10million pounds to bring us up to our credit ceiling limit. We are effectively borrowing from reserves so for example, if the pier arbitration result is not in our favour and we are instructed to pay up a significant amount of money; we will need to borrow quickly from the Public Works Loan Board (PWLB) in order to pay.
The significant changes in strategy are as follows:–
· A change in Authorised Borrowing limits; and
· Investment in property funds: - either through a company like Capita and a network of different investment companies, or alternatively;
- CCLA who have funds under management
from 160 authorities (churches, charities etc.)
and are the choice investment company for
the Foreshore Trust Charity
We are used to dealing with CCLA, therefore if there is a problem in funds, the owners of the fund have a larger say in what happens.
Councillor Sinden asked what the effect would be if the interest rates were to go up suddenly by, say, ½%. The Assistant Director, Financial Services and Revenues, replied that if the interest rates were to go up by ½%, investment interest would increase, HBC would be better off since it is currently borrowing at a low fixed term borrowing rates and so a ½% increase in interest rates would be reflected in a net overall increase to the Council. ... view the full minutes text for item 55.
The Assistant Director, Financial Services and Revenues, presented a report to formally confirm that the Annual Audit Letter 2015/16 has been noted by the Audit Committee.
The purpose of the Annual Audit Letter 2015/16 was to consider the matters raised by the external auditors (BDO). This was circulated to the Audit Committee on 15th November 2016 and posted to the Council’s website for the public and members to view.
RESOLVED (unanimously) that the report be noted.
The reason for this decision was:
The Annual Audit Letter is for all members and posted to the Council’s website. It is of particular interest to those charged with governance.
The Chief Auditor presented a report to inform the Audit Committee of the key findings from the recent Section 106 Agreements audit.
The purpose is to ensure the council has the right processes and procedures for monitoring each agreement and ensuring complete accurate and timely receipt of all income due.
The review had found that the controls in place were good and worked effectively, no significant audit concerns were raised.
Councillor Charman sought clarification on what areas were being referred to in the report. The Chief Auditor said that no specific area had been selected but that the review covered all 43 current agreements. The whole of the control spreadsheet had complied with Finance’s figures and the difference that had been highlighted and investigated had been over two planning applications. The Assistant Director, Financial Services and Revenues advised that the money needs to be spent within the time scale otherwise it is lost. He was pleased to get a good result.
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)