Agenda and minutes

Audit Committee
Thursday, 10th December, 2015 7.00 pm

Venue: Civic Offices, St Nicholas way, Sutton, SM1 1EA

Contact: Susanne Wicks, Committee Support Team Leader  Tel: 020 8770 6540 | Email:  susanne.wicks@sutton.gov.uk

Items
No. Item

27.

Apologies for absence

Minutes:

Apologies were received from Councillors Ali Mirhashem and Alan Salter.  Councillor Richard Clifton attended as substitute. 

28.

Declaration of interests

Minutes:

No declarations of interest were made.

29.

Minutes of the last meeting pdf icon PDF 130 KB

To approve as a correct record the Minutes of the meeting held on 24 September 2015.

Minutes:

RESOLVED: That the minutes are agreed as an accurate record of the meeting.

30.

Treasury Management Quarterly report Quarter 2 pdf icon PDF 470 KB

Minutes:

The report was presented by the Head of Financial Strategy and Planning, Lyndsey Gamble, who welcomed comments and questions. 

 

Councillor David Hicks asked when the two recently repaid loans were originally taken out, and Lyndsey Gamble undertook to consult the load schedule and report back.

 

At the request of Councillor Richard Broadbent, Lyndsey Gamble gave a more detailed explanation of the impact on the Capital Financing Requirement of the appropriation of land and buildings from the general fund to the HRA and vice versa.  She confirmed that the market value of land and buildings will be assessed by an appropriate surveyor. 

 

RESOLVED:  That the Audit Committee

 

1.    Notes the Treasury Management activity taken during the first six months of the year.

 

2.    Adopts the report as the mid-year Treasury Review and recommends it to Full Council.

31.

Member Development - Progress of the South West London Fraud Partnership

Minutes:

Kevin Holland, Head of Fraud, South West London Fraud Partnership (SWLFP) gave a detailed presentation to the Committee covering:

 

Background and structure of the SWLFP;

Governance

Fraud activity

Investigations

Contact details. 

 

Kevin Holland welcomed comments and questions. 

 

Councillor Adrian Davey asked where the responsibility for fraud prevention sits, and Kevin Holland explained that the SWLFP point out any possible gaps in control in the monthly updates to the relevant Heads of Audit and Directors of Finance.   The Strategic Director of Resources confirmed that Internal Audit regularly carries out fraud prevention awareness activities and fraud awareness training has been developed for managers. 

 

In response to a question from Councillor Richard Clifton, Kevin Holland advised that each local authority decides whether or not to prosecute those found carrying out fraudulent activity as they must bear the cost of any prosecution. 

 

Kevin Holland explained that if a RIPA authorisation is required, a request will be made to the appropriate officer in each authority.

32.

Fraud Referrals and Investigations update pdf icon PDF 184 KB

Minutes:

The report was presented by Kevin Holland, Head of Fraud, South West London Fraud Partnership.  He invited comments and questions.

 

Kevin Holland confirmed that working relationships with the Sutton Housing Partnership are improving and referrals are returning to normal levels.  He also advised that the issues with access to LBS IT systems should be remedied when all officers have transferred to the Modern Desktop environment. 

 

Kevin Holland explained that although all constituent local authorities agreed to share data appropriately, some individual teams have been reluctant to do so.  The Executive Head of Finance reassured the Committee that those teams will be notified of the clear, legally approved agreement to share the data. 

 

Councillor David Hicks asked if there were any emerging trends across the authorities in the Partnership.  Kevin Holland gave brief details of the issues emerging across London with regard to people with no recourse to public funds, but commented that this had not been noted within the Partnership boroughs to date.  He also remarked upon the work carried out with regard to Right to Buy applicants in receipt of Housing Benefit. 

 

RESOLVED: That the Audit Committee notes the report.

 

33.

Internal Audit Half Year Progress report pdf icon PDF 181 KB

Additional documents:

Minutes:

The report was presented by the Interim Head of Audit, Margaret Culleton, who welcomed comments and questions.

 

Councillor Richard Broadbent questioned the discrepancy between the budgeted days and actual days spent on “Advice and Consultancy” as detailed in paragraph 5.3 of the progress report.  Margaret Culleton explained that this category covers issues raised by officers and members that do not require a full audit report.  The Executive Head of Finance added that he and Margaret Culleton discuss and supervise such work, and he raises issues with the Strategic Director of Resources if required.  Margaret Culleton confirmed that the audit plan will not be revised as it is anticipated that planned audits will be carried out, despite some slippage in the first part of the year. 

 

The Strategic Director of Resources updated the Committee on the recommendations relating to the Shared HR and Payroll Service, which include recruitment activity to fill a critical post within the service, currently filled on an interim basis. 

 

RESOLVED:  That the Audit Committee notes the report. 

 

34.

Annual Audit Letter 2014/15 pdf icon PDF 144 KB

Additional documents:

Minutes:

This report was presented by the Executive Head of Finance, Phil Butlin, who highlighted that the Annual Audit Letter will be reported to the Strategy & Resources Committee on 14 December.  He welcomed questions and noted that this Committee’s comments will be presented to Strategy & Resources Committee.

 

Phil Butlin confirmed that the Housing Benefit Grant Claim had been completed, and unqualified opinion issued. 

 

RESOLVED:  That the Audit Committee

 

1.    Welcomes the outcome of the external audit of the Council’s accounts for 2014/15 and notes that work to address the auditor’s recommendations is in hand.

 

2.    Has no comment to be brought to the attention of the Strategy & Resources Committee. 

 

35.

External Audit update pdf icon PDF 604 KB

Minutes:

Christian Heeger and Tom Ball of Grant Thornton presented this report.

 

Christian Heeger reminded the Committee that the deadlines for submission of final accounts will be brought forward from 2018 onwards.  He advised that the dates for this Committee should change accordingly and also reassured the Committee that work is ongoing within Grant Thornton to ensure the earlier deadline will be met.

 

The Executive Head of Finance, Phil Butlin, confirmed that Finance officers are already considering how the earlier submission will be managed and are likely to rehearse this next year in preparation.  He advised of other actions being taken to ensure the new deadline is met. 

 

Phil Butlin advised the Committee that the term of appointment for Grant Thornton as auditors will come to an end in 2017, and undertook to bring information on the procurement of an auditor after that to a meeting in 2016.

 

Report received. 

 

36.

RIPA (Regulation of Investigatory Powers Act) update pdf icon PDF 161 KB

Additional documents:

Minutes:

This report was presented by Peter Rollins from the South London Legal Partnership, on behalf of the Senior Responsible Officer, the Executive Head of Business Services.

 

Peter Rollins referred to the comments made by Kevin Holland regarding the trend for local authorities to undertake activities that do not require RIPA authorisation, and highlighted the need to ensure that the same benchmarks are in place for social media, which are detailed within the social media policy.  In response to questions, Peter Rollins explained why the policy is required, even for platforms such as Facebook, where much of the information is publicly available.  Councillors commented that it was not clear that the social media policy applies to investigating officers, so Peter Rollins undertook to add ‘for investigating purposes’ to the policy.

 

Councillor Richard Clifton asked why the rate of applications is so low, given the public perception of high rates of tenancy fraud.  Peter Rollins explained that a lot of actions to uncover fraud can be taken without using RIPA, and much of the work has been delegated to the Department of Work and Pensions and to the South West London Fraud Partnership. 

 

RESOLVED: That the Audit Committee

 

1.    Notes the annual report on RIPA activity.

 

2.    Notes the steps taken to discharge the recommendations of the inspection report dated 6 May 2015.

 

3.    Endorses the Social Network Sites Investigative Policy (as amended).

37.

Audit Committee work plan pdf icon PDF 182 KB

Minutes:

The Committee discussed possible topics for member development.  It was agreed that the next session should be led by Grant Thornton and centre on evaluating the effectiveness of the Committee.

38.

Any urgent items brought forward at the discretion of the Chair

The Chair must approve the reason for urgency.

Minutes:

No items were raised. 

39.

Date of next meeting

The next meeting of the Audit Committee will take place on 24 March 2016 at 7 pm.

Minutes:

The next meeting of the Audit Committee is scheduled for 24 March 2016 at 7 pm.

 

Councillor David Hicks noted that the next meeting is scheduled for Maundy Thursday, and suggested that the meeting take place at 2 pm instead of 7 pm.  The clerk undertook to consult with Committee members.