Agenda and minutes

Apologies for absence were received from Councillor Sylvester.  Councillor Johnson was in attendance as a nominated substitute.

At this point Members must declare whether they have a disclosable pecuniary interest, or other interest, in any of the items on the agenda, unless it is already entered in the register of members’ interests or is a “pending notification “ that has been disclosed to the Head of Legal Services.

There were no declarations of interest. 

To approve the minutes of the meeting held on 29 June 2015.

The minutes of the meeting held on Monday, 29 June 2015 were approved as an accurate and true record.

To receive the final Statement of Accounts for the year ended 31 March 2015 incorporating the Annual Governance Statement together with the annual report to those charged with governance following their scrutiny by External Audit.

The Corporate Director Resources and Financial Services Manager introduced the report to Audit Committee Members on the Audit of Statement of Accounts (SoA), which was in line with the regular pattern of reporting on the Council’s financial position.  The Corporate Director Resources also advised Audit Committee Members that there had been a difference of opinion held between Peterborough City Council (PCC) and external auditors PwC in respect of the Council’s valuation and accounting treatment for schools.  Members of the Audit Committee also received an amendment to the statement of accounts report, which had been circulated prior to the meeting and attached at appendix one of these minutes.

Julian Rickett from (PWC), also highlighted a number of key points for Members attention in relation to the Audit of Statement of accounts report.

Key points highlighted included:

• Report to those charged with governance;
• The majority of outstanding matters had been satisfactorily resolved and ahead of deadlines, however, there were some outstanding issues in relation to bank loans and two minor queries in relation to employees salary;
• There had been some changes made in relation to risk assessments for ISAs for property, plant and equipment.  This was a national approach by PwC;
• Significant risks audit and accounting matters such as valuation of property, plant and equipment.  It was appreciated by PwC that different valuers applied a different approach;
• Land valuations were within an acceptable range;
• School valuation treatment;
• Pension liability and the actuary valuation;
• Corrected and uncorrected misstatements in the accounts, which PwC had credited the PCC Finance Team for;
• Appropriate treatment of school title deeds;
• Value for money of service for the work undertaken by PwC;
• Risk of fraud; and
• PwC fees and expected outturn.

The Corporate Director Resources and Financial Services Manager and Julian Rickett (PwC), responded to comments and questions raised by Members. A summary of responses included:

• The £6,669 fee for assessing the accounting treatment of schools  had related to the additional work undertaken by PwC which followed CIPFA rulings and did not cover the audit of individual schools; 
• Each school asset in relation to the different types of schools such as Local Authority (LA) or foundation required a different audit treatment;
• The pension liability amount would always be audited regardless of the size of the figure and PwC’s responsibility would be to ensure that it was outlined correctly within the statement of accounts;
• PwC would comment on the property, plant and equipment outlined within the statement of accounts as it was such a large figure within PCC’s financial accounts;
• PwC would comment on the budget gap in terms of a conclusion for the delivery of value for money in relation to securing financial resilience;
• The higher PCC increased payments into pension funds to remove the gap, the wider the budget deficit would be within the current financial year;
• PCC relied on the tri-annual valuation of the pension fund set by the actuary to determine PCCs financial commitments for pensions;
• There had been a pot of money,  ...  view the full minutes text for item 4.

To receive details of the strategic risks impacting on the Council and the mitigating actions to address these.

The Head of Resilience introduced the report to Audit Committee Members, which provided a quarterly update on the Risk Management and Business Continuity position for the Council. 

The key points highlighted included:

• The Strategic Risks were reviewed on a quarterly basis;
• The impact of demographic changes had been included in all plans;
• Safeguarding had shown as a high risk;
• The financial position for the LA had also increased recently; and
• Information governance.

The Head of Resilience responded to comments and questions raised by Members.  In summary responses included:

• High risks such as safeguarding, would be monitored and reviewed every three months by CMT.  The shorter term risks that fluctuated would be reviewed every six months;
• Additional measures would be introduced for higher risk service issues; such as the recent  recruitment campaign to employ ‘alternatively qualified workers’  to support social workers in order to mitigate the safeguarding risk for Peterborough’s vulnerable cohort; 
• The budget risk was a longer term issue due to the nature of the City and government pressures, which could mean that the financial situation would not improve over a short period of time and it was difficult to predict the financial situation long into the future;
• Members commented that there had been a national issue experienced with the recruitment of social workers and that the LA’s plans to improve the situation locally had been innovative.  It had been anticipated that there would be an idea in the next six months as to whether the situation had improved for the LA; and 
• Members also commented that Audit Committee’s in other Local Authorities had undertaken an active role in driving non-performance, which had proved effective in driving down risks.

The Committee:

Considered and noted the report and thanked the Head of Resilience for a good report.

         The Compliance Manager (Governance) introduced the RIPA report for the period 1 March 2015, which outlined the use of the Council’s covert surveillance to investigate issues such as fly tipping.

The key points highlighted included:

• There were proposals for the Council to install covert surveillance cameras in strategic positions throughout Peterborough to address fly tipping.  The use would be reported to Audit Committee in the usual way;
• The Protection of Freedoms Act 2012 introduced a criminal threshold for council’s intending to use RIPA powers. The offence must be punishable by a maximum minimum of six months imprisonment or related to the underage sale of restricted products;
• Robust surveillance procedures and the judicial approval of RIPA use as appropriate;
• RIPA powers had been last used in February 2015 in relation to the sale of tobacco to under age customers;
• The recent three yearly inspection conducted by the Office of the Surveillance Commissioner (OSC), which was a positive and helpful process in respect of recommendations made about PCC’s policies, procedures and training on the use of RIPA; and
• An update report would be presented to Audit Committee, which had been intended to outline how the OSC inspector’s recommendations had been implemented.

The Compliance Manager (Governance) responded to comments and questions raised by Members.  In summary responses included:

• The criminal threshold included the minimum/maximum punishment of six months imprisonment and also for offences in relation to the underage sales of age restricted products, however, it was believed that there were usually warnings issued in the first instance for such sales;
• RIPA provided a framework, which allowed the Council to demonstrate why it had undertaken surveillance action;
• The Council had to seek internal approval for the use of RIPA in the first instance and then from a Justice of the Peace before any surveillance action can be undertaken.  Issues such as planning enforcement may fall outside of the RIPA process due to the fact that the issue may not meet the crime threshold. However, the Council would apply the same reasonableness and proportionate criteria when planning issues were investigated; and
• Surveillance cameras used to identify fly tipping offences would be placed in locations where intelligence indicated that there was a high risk of fly tipping. This may be based on reports and regular incidents.

The Committee:

1.Received, considered and endorsed the report on the use of RIPA for the period since 1 March 2015; and

2.Noted the recommendations of the OSC inspection and agreed a further report to Audit Committee regarding actions against the recommendations.

The Committee is asked to NOTE that there have been no approved write-off amounts to report since  29 June 2015, which exceed the Council’s Financial Regulation threshold of £10,000.

The Committee noted that there had been no write-offs for the Council exceeding £10,000.

The Chairman introduced a report, which provided feedback on items considered or questions raised at the previous meeting of Audit Committee.  It also provided an update on specific matters which were of interest to the Committee or where the Committee had requested to be kept informed of progress.

The Committee:

Noted the report.

The Chairman introduced a report, which provided feedback on items considered or questions raised at the previous meeting of Audit Committee.  It also provided an update on specific matters which were of interest to the Committee or where the Committee had requested to be kept informed of progress.

The Committee:

Noted the report.