Agenda and minutes
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Contact: Committee Section
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Apologies for absence Minutes:
No apologies of absence were received.
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To sign the minutes of the previous meeting. Minutes: The minutes of the meeting on Tuesday, 10 March 2020 were signed by the Chair. |
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Declarations of Interest Minutes: Cllr Gow and Cllr Rice declared an Other Significant Interest as appointed Directors of Rosherville Limited, the Council’s Local Authority Trading Company.
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General Fund Provisional Outturn Report Minutes: The Committee was presented with the 2019/20 provisional General Fund Outturn Report, including movements in the General Fund working balances and earmarked reserves and the 2019/20 provisional General Fund Capital Outturn.
The Principal Accountant (General Fund) advised that the report was labelled as provisional as it was still subject to the external audit process and the receipt of the final audit opinion which will come to the Finance & Audit Committee in due course.
The Principal Accountant (General Fund) directed Members to page 14 of the report which held an Executive Summary of the information in the report pertaining to the:
Members were updated on other key areas of financial performance that may impact on the Council’s Medium Term Financial Strategy, Medium Term Financial Plan, or Financial Statements.
The Chair thanked the Principal Accountant (General Fund) for the detailed run through of the report and opened up the report to Members questions.
Cllr Ejaz Aslam requested that it be noted that the Conservatives had full confidence in the Finance Team and were proud to work with them to monitor Gravesham Council’s finances.
Following questions for clarification, the Principal Accountant (General Fund) elaborated further on several variances within the report:
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Housing Revenue Account Provisional Outturn Report Minutes: The Committee was presented with:
The Principal Accountant (General Fund) advised that the report was labelled as provisional as it was still subject to the external audit process and the receipt of the final audit opinion which will come to the Finance & Audit Committee in due course.
The Principal Accountant (General Fund) directed Members to page 35 of the report which held an Executive Summary of the information in the report pertaining to the:
Members were updated on other key areas of financial performance that may impact the HRA Business Plan.
Following Members comments and questions, the Director (Corporate Services), the Principal Accountant (General Fund) and the Deputy Principal Accountant explained that:
The Deputy Principal Accountant agreed to the following:
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Annual Treasury Management Review 2019-20 Additional documents:
Minutes: The Committee was presented with a report that updated them on treasury management activity during 2019-20 in accordance with the requirements of the Chartered Institute of Public Finance and Accountancy’s (CIPFA’s) revised code on Treasury Management.
The Principal Accountant (General Fund) outlined key points from the report regarding:
Concern was raised by a Member over the ‘authorised spending limit’ as in 2019/-20 the limit stood at £154 million with the description stating that it was sustainable in the short term but unsustainable in the long term. That figure had increased to nearly £257 million and clarification was sought by the Committee on that statement and at what point the total figure will actually become unsustainable for the Council.
The Director (Corporate Services) advised that it was important to differentiate between ‘the authorised limit’ and ‘the operational boundary’; the latter was the expected borrowing position of the Council during the year. Whereas the former was the affordable borrowing limit that officers could go up to if there was a cashflow issue and a level of borrowing was necessary to assist in managing short term cash flow issues. The ‘operational boundary’ was a truer figure of the Council’s actual borrowing need and the increase in the expected borrowing limit in 2019-20 was due to the St Georges Centre financial transaction; that decision was approved by Full Council.
Concern was raised by a Member over the Committee’s understanding of sustainability and the risk of increasing the Council’s gross external debt, using the CIPFA Resilience Index as a reference point.
The Director (Corporate Services) explained that it was problematic directly comparing all English Council’s against the CIPFA Resilience Index; some local authorities had Housing Revenue Accounts and some didn’t which meant those without a HRA had not been required to borrow money to purchase their housing stock in 2012. It is also important to understand the level and sources of income to support any borrowing undertaken.
It was resolved that:
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Annual Governance Statement 2019-20 Additional documents:
Minutes: Member’s approval was sought for the Council’s Annual Governance Statement for the 2019-20 financial year.
The Director (Corporate Services) outlined the key points from the report regarding the annual review of the Council’s governance framework 2019-20 and drew Members attention to the following:
The Chair sought clarification on health and safety arrangements for officers working from home and in different environments from the Civic Centre.
The Director (Corporate Services) confirmed that as part of the home working arrangements that came into effect very quickly due to lockdown, a staff risk assessment was sent to every staff member so that they could assess their work environment. Using this information, Managers had been able to make adjustments where necessary for staff members and other staff members were brought back into the office if their home environment was not suitable for them. The Council supported all staff with health and wellbeing issues during the lockdown and will continue to do so.
The Director (Corporate Services) added that a review of working arrangements will be picked up within the review of the council’s response to the COVID-19 crisis.
It was resolved that:
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Annual Audit & Counter Fraud Report 2019-20 Additional documents: Minutes: The Committee was informed of the work completed during 2019-20 and presented with the opinion of the Head of Audit & Counter Fraud Shared Service, as Chief Audit Executive, on the Council’s internal control environment.
The Head of Audit & Counter Fraud Shared Service advised that the opinion was listed in full on page 116 of the report, this being that:
‘It is therefore my opinion that Gravesham Borough Council’s framework of governance, risk management and system of internal control is adequate and effective, and contributes to the proper, economic, efficient and effective use of resources in achieving the council’s objectives.’
The Head of Audit & Counter Fraud Shared Service further guided Members through the report and highlighted key points from the following areas:
· Independence · Resources · The Results of Planned Audit & Counter Fraud Work · 2018-19 Internal Audit Assurance work Finalised in 2019-20 · 2019-20 Internal Audit Assurance work · Quality Assurance & Improvement Programme · Follow up of agreed recommendations · Recommendations outstanding more than six months after scheduled implementation date
Concern was raised by a Member over any delays in putting arrangements in place to monitor sickness and absence during the lockdown.
The Director (Corporate Services) explained that HR had been working on the arrangements prior to COVID and had reinforced the reporting requirements during COVID-19 which was successful. The Director (Corporate Services) advised that she had received information relating to sickness absence within her directorate every month, which assisted her in managing any issues in Corporate Services.
It was resolved that:
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Draft Audit Plan 2020-21 Additional documents:
Minutes: Approval was sought from the Committee for a Revised Audit & Counter Fraud Plan 2020-21 for Gravesham.
A risk based plan to determine the priorities of the internal audit activity was prepared and presented to the Finance & Audit Committee on 10 March 2020 for approval. However, since that plan was approved there have been significant changes to the way in which the Internal Audit and Counter Fraud resource had been deployed since 1 April caused by the impact of the Covid19 pandemic; this resulted in the need for a revised plan to be created for the period 01 July 2020 to 31 March 2021.
The Head of the Audit & Counter Fraud Shared Service stated that Appendix Two to the report outlined the full Revised Audit & Counter Fraud Plan 2020-21 and appendix three outlined the planned assurance reviews that were no longer on the 2020-21 plan.
It was resolved that:
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Fee Scale for the 2020-21 Audit and update on 2019-20 fees Minutes: The Committee was presented with the fee scale for the 2020-21 external audit and given an update on 2019-20 audit.
The Director (Corporate Services) explained that:
Following a question, the Director (Corporate Services) confirmed that the scale fee was exclusive of VAT and the Council would be able to recover the cost of VAT so the figure shown in the document was the true cost of external audit to the Council.
It was resolved that:
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Draft response to Letter to Those Charged with Governance Additional documents:
Minutes: Members were provided with the opportunity to consider and discuss a number of questions posed by the External Auditors to the Finance & Audit Committee in relation to the Council’s arrangements to manage fraud risk and ensure legislative compliance.
As part the audit risk assessment procedures, Grant Thornton UK LLP posed a number of questions directly to the Finance & Audit Committee regarding how the committee oversaw the Council’s management processes and arrangements. A copy of the letter sent to the Chair of the Finance & Audit Committee was provided at Appendix Two and the draft responses to the questions were listed at Appendix Three for Members to approve.
It was resolved that:
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