Agenda and minutes

To receive any apologies for absence

Apologies were noted from Cllr Symington. 

To receive any declarations of interest

A member with a disclosable pecuniary interest or a personal interest in a matter who attends a meeting of the authority at which the matter is considered -

(i)            must disclose the interest at the start of the meeting or when the interest becomes apparent

and, if the interest is a disclosable pecuniary interest, or a personal interest which is also prejudicial

(ii)        may not participate in any discussion or vote on the matter (and must withdraw to the public seating area) unless they have been granted a dispensation.

A member who discloses at a meeting a disclosable pecuniary interest which is not registered in the Members’ Register of Interests, or is not the subject of a pending notification, must notify the Monitoring Officer of the interest within 28 days of the disclosure.

Disclosable pecuniary interests, personal and prejudicial interests are defined in Part 2 of the Code of Conduct For Members

[If a member is in any doubt as to whether they have an interest which should be declared they should seek the advice of the Monitoring Officer before the start of the meeting]

There were no Declarations of Interest.

To confirm the minutes of the previous meeting and consider the actions

The Minutes of the previous meeting were review and agreed with the following comments

Cllr Birnie noted that ‘response inaudible’ was noted twice on page 6 of the minutes and asked if this meant that the responses had therefore been lost.  It was noted that this could be checked with Member Support to check if any additional notes were made but that the response may not have been audible as part of the recording. 

An opportunity for members of the public to make statements and ask questions in accordance with the rules as to Public Participation

There was no public Participation.

·         Auditor’s Annual Report  2020-21

AJha referred to the auditor’s report, noting the change in reporting on VFM work and that this year there is no requirement to provide a qualified or unqualified BFM conclusion and instead they are required to report on overall arrangements including financial sustainability, governance and the 3 Es of VFM.  Recommendations and any significant weaknesses are then raised as a result of this.  AJha noted the types of recommendations that can be given with statutory recommendations where significant weaknesses have to be disclosed publicly and a response to reports has to be provided, and that no such recommendations have been identified.  Key recommendations are on significant weaknesses regarding governance, financial sustainability and the 3 Es of VFM, and it was confirmed that none have been identified. 

AJha confirmed that some recommendations for improvement regarding processes and benchmarking have been made, as detailed on pages 15-16 of the report.  AJha noted that recommendations were raised on governance and economy efficiency and effectiveness, and took the report as read.  It was confirmed that the recommendations have been acted upon by the management and an action plan has been drafted, which forms part of the recommendation.

Cllr Birnie commented on the accuracy of the KPIs, noting that this has been encountered across numerous parts of the council, and asked if there was a date for this improvement.  AJha explained that this was being worked upon and the process has started, and that there would be a review of recommendations that have been raised.  Cllr Birnie noted page 26 of the report that states the KPI review would be completed in February 2022.  It was confirmed that this was management’s comment when the report was submitted in December and would be reviewed again.  FJump added that the recommendation regarding KPIs was for the council to further publish their confidence behind each KPI rather than the accuracy of the reports.  Cllr Birnie stated that his focus was on SPAE and that the officer in charge of Cupid Green has asked for KPIs to be reviewed.  FJump confirmed that specific KPIs would be looked at as part of the service review process and that this is underway, and a timescale could be brought back to the Committee if required. 

·         Annual Audit Plan 2021-22

The report was taken as read.

The key factors and significant risks were highlighted, as outlined on page 39 of the report.  It was confirmed that the materiality levels will be £3m, which remains unchanged from last year, and the benchmark of 2% of the prior year gross expenditure also remains unchanged.  Any identified errors above £150k will be reported, though any errors over £3m will need to be adjusted, with the methodology remaining the same as last year.

Significant risks have been identified as:

·                        Material misstatement of accounts

·                        Fraud risk over expenditure recognition

·                        Management override of controls

·                        Valuation of the land, buildings and pensions being misstated

Auditors are required to comment on any cautious or optimistic estimates, as per ISA 560, and it is felt there is significant judgement involved in the estimations of land, buildings, council dwellings, accruals and pension fund liabilities. 

Cllr Birnie commented on Grant Thornton’s inspection by the FRC, noting that 9 audits were reviewed, and asked if DBC was included in any of these.  It was confirmed that none of those reviewed included the public sector and that Grant Thornton had performed well against the big 4. 

An update was provided on the housing benefit audit where it was noted that the audit should be closed by 15^th April with a report to be submitted thereafter. 

Cllr Townsend queried the timings of the audit report.  It was confirmed that this is set out on page 49 of the report and that the aim is to start the final audit by July for completion by September.  An audit opinion and findings report should be submitted for the Audit Committee meeting on 15^th September.

·         SICA report

·         Housing Rents report

·         Key Financial Controls – Debtors and Arrears report

·         Waste Management report

PLazenby provided an overview of audit reports, noting that 2 audit reports have been completed since the last meeting.  1 audit report has been delayed due to no DBC representative being available for the last meeting to provide a response, and that this has now been provided today. It was confirmed that there is a range of audit opinions with 1 substantial, 1 limited and 1 reasonable. 

For the Housing Rents report, it was confirmed that there were 4 important, 2 routine and 2 operational recommendations made.  The audit identified that Housing Rents are present in relation to payments arrears and former tenant arrears, though there are issues regarding priority 1s with all cases having inconsistencies and a general failure in escalation.  Performance of individuals in relation to current tenant arears and systems in relation to former tenant areas was also queried.  A management response was given in relation to issues raised, indicating that responses are being addressed in a timely manner.  There was also some mitigation with management contributing to observations as well as through the recruitment of 2 posts.  It was also noted that management have provided a response regarding the balance of the suspense account and have confirmed this will be reviewed in September.  It was confirmed that no issues were overly concerning in nature, but that errors and consistency were present in a reasonable proportion of items reviewed and that management must address underlying issues.  It was also noted analytical techniques will be brought into next year’s plan and that issues must therefore be addressed. 

Cllr Birnie asked why it took 2 years for the auditors to discover that the rent arears, and write-off policy review was 5 years overdue.  It was confirmed that the audit programme runs across a 3-year rolling plan and that this had not been incorporated within the plan.  Cllr Birnie stated that this was important as part of the rent arears and that he was surprised it had not been reviewed. OJackson confirmed that a light-touch review of the policy has been carried out and a full review is booked in for Q2. 

Cllr Birnie commented there was no figure for the total of arears over the period.  PLazenby confirmed that this was not included in the report and that the review was on the process rather than the figures. 

Cllr Birnie noted the appointment of 2 further housing officers and asked if the amount of arears and write-offs justified this expense. OJackson advised that the growth bid was submitted for 2 additional income officers, which includes a number of KPIs, and they are recruited on a 2-year fixed-term basis to allow the impact of these 2 additional posts to be assessed.  It was noted that the addition of these 2 members of staff also brought the team in line with other neighbouring authorities. 

Cllr Birnie remarked that he hoped F&R Committee have access to the figures, adding that this was not the case for the SPAE O&S Committee,  ...  view the full minutes text for item 7.

·        Annual Internal Audit Programme 2022-23

PLazenby presented the internal audit plan, noting that the 3-year rolling plan has been previously presented.  The current plan is as is listed in the programme, and PLazenby noted that some dates may have changed, such as bringing some audits forward.

Cllr Townsend asked if they could suggest items for audit.  PLazenby confirmed that the plan is malleable and further topics could be recommended.  Cllr Townsend commented on the planning application process, noting issues with viewing plans in the portal and not being able to comment on amended plans.  Cllr Townsend recommended that an audit be conducted on whether those who are asked to comment on plans are seeing the right ones and whether there are any operational issues in the process.  FJump noted that there was potential time in the plan to allocate to this and that this request would be looked into further.  Cllr Birnie noted the new planning system is being embedded and commented that he was pleased to see planning enforcement listed.

·         SRR Q3 2021-22 report

·         Appendix A- Strategic Risk Register Q3 2021-22

FJump noted that no papers had been tabled for the item and asked that it therefore be deferred to the next meeting.  The Committee agreed that the item be deferred.

To consider items to be brought to future Audit Committee meetings.

Standing Items 

Apologies for Absence

Declarations on Interest

Minutes and Actions

Public Participation

External Audit

Internal Audit

Work Programme

Cllr Chapman noted the work programme and confirmed no further additions.