Agenda and minutes

To note any apologies for absence.

Apologies for absence were received from Cllr Gorrie, for whom Cllr Strang was substituting, and from Cllr Bloch, for whom Cllr Erskine was substituting.

Cllr Butcher apologised that he would be required to leave before the end of the meeting.

The Chair will consider the admission of any late items of urgent business. (Late items will be considered under the agenda item where they appear. New items will be dealt with at item 15 below).

There were no items of urgent business.

A member with a personal interest in a matter who attends a meeting of the authority at which the matter is considered must disclose to that meeting the existence and nature of that interest at the commencement of that consideration, or when the matter becomes apparent.

A member with a personal interest in a matter also has a prejudicial interest in that matter if the interest is one which a member of the public with knowledge of the relevant facts would reasonably regard as so significant that it is likely to prejudice the member’s judgement of the public interest and if this interest affects their financial position or the financial position of a person or body as described in paragraph 8 of the Code of Conduct and/or if it relates to the determining of any approval, consent, licence, permission or registration in relation to them or any person or body described in paragraph 8 of the Code of Conduct.

Cllr Butcher declared a personal interest in respect of item 8, the Review of Leasehold Service Charges, as a Haringey Leaseholder.

To confirm and sign the minutes of the Audit Committee held on the 25 March 2010.

RESOLVED

That the minutes of the meeting held on 25 March 2010 be approved and signed by the Chair.

There were no deputations or petitions.

The Committee received an update report from Grant Thornton, the Council’s external auditors. Paul Dossett, Grant Thornton, reported that as a result of the Use of Resources scored assessment being withdrawn, Use of Resources scores would not be published for 2009/10. The Council had previously scored a Level 3 for 2008/09. Although no score would be published, Grant Thornton would still present a report to the Committee, based on the Use of Resources work that had been undertaken, along with any recommendations.

RESOLVED

That the content of the report be noted.

Report of the Chief Financial Officer to inform the Committee of the proposed audit and inspection fees for 2010/11 to be charged by Grant Thornton and the Audit Commission.

Kevin Bartle, Head of Corporate Finance, presented the report on Audit and Inspection Fees for 2010/11 and confirmed that officers were satisfied with the level of fees proposed. Paul Dossett, Grant Thornton, reported that the letter attached to the report was the indicative fee letter, as required by the Audit Commission. This would then be revised to take into account the outcome of the previous year’s audit, once completed. Although the Use of Resources scored assessment had been withdrawn, it was reported that the majority of the work had already been undertaken and that a significant reduction in fee in respect of this was therefore unlikely in the current year. A reduction in fee would, however, be seen in 2011/12. It was reported that the Audit Commission would be issuing a fees consultation in the next month to consider the impact of recent changes by the Government. Grant Thornton offered to share the Audit Commission consultation document with the Committee, via officers, once it was published

In response to a question from the Committee, it was reported that the proposed fees for Haringey were 5% below the Audit Commission scale fee.

The Committee expressed the view that the abolition of the CAA should be reflected in a substantial reduction in audit fees for local authorities, and requested that these views be fed back to the Audit Commission. The Committee noted that in the current financial climate, the proposed expenditure of amounts such as those represented by the fees in the report had to be scrutinised closely.

In response to a question from the Committee regarding why a significant proportion of the Use of Resources work had already been carried out, Paul Dossett reported that although the scored assessment had been abolished, it was still a requirement as part of the audit process for the external auditors to form a conclusion regarding whether the Council was achieving value for money. In response to a question from the Committee regarding the engagement of officers with the progress, it was confirmed that officers worked together with Grant Thornton on this.

In response to a question from the Committee as to whether the fees outlined in the report had already been spent, it was confirmed that they were in the process of being paid. It was reported that the fees charged to the 2010/11 budget related to work already completed to the end of April 2010. The Committee expressed the hope that 2011/12 would see a significant reduction in fees. Kevin Bartle advised that the fee for certification of claims and returns was estimated, and that officers were working to increase the quality of these areas to ensure that the actual fee required was lower than the estimate. Mr Bartle reported that the number of areas which could be challenged in respect of the Audit fees was limited.

The Committee expressed concerns that the fees exceeded the amount budgeted, and asked what assumptions were used in setting the budget in this area, and  ...  view the full minutes text for item 7.

Report of the Director of Urban Environment to inform the Committee of the outcomes of a Grant Thornton review of leaseholder service charges administered on the Council’s behalf by Homes for Haringey.

Phil Harris, Assistant Director of Strategic and Community Housing, introduced the report on leasehold service charges from Grant Thornton, and the Council’s responses. The overall conclusions of the Grant Thornton report were that the home ownership team were efficient in calculating service charges, and the report also set out examples of best practice and specific areas where Haringey could make improvements. It was reported that there were a number of areas where the recommendations of Grant Thornton had not been agreed and reasons had been provided for this, however Grant Thornton had confirmed that none of these areas were of fundamental importance, and would be kept under further review.

David Longbottom, Grant Thornton, reported that the review was of  a high-level, strategic nature rather than a detailed examination. It was reported that a number of examples of good practice had been found, and the overall conclusion was that the home ownership team managed charges in an efficient and effective manner, with statements being provided to leaseholders in a timely and well-managed way and based on good quality information. Mr Longbottom outlined the recommendations that had been made and reported that, where the recommendations had not been agreed by the Council, these were areas of low to medium risk and the responses were adequate for the time being but would require further review.

In response to questions from the Committee, Mr Longbottom confirmed that no leaseholders had been interviewed during the course of the review and that a single sample service charge statement had been reviewed. Mr Longbottom advised that they had requested to interview leaseholders, however this had not proved possible in the timescale available. It was reported that as it was a high level review, the focus was on the way in which systems were used to manage information, and not on the detailed analysis of individual accounts.

Committee Members confirmed that, as ward councillors, they often encountered residents with concerns regarding statements, and expressed concern that the methodology of this review would not be able to provide assurance on whether Homes for Haringey was obtaining the best value for money. Mr Longbottom stated that the review had been a short, high level diagnostic review, the scope of which was to focus on whether the systems were in place to deliver value for money. Based on experience of more extensive leasehold reviews carried out for other authorities, Grant Thornton recognised the issues raised by Members, but emphasised that this review was to look at the systems in place. Paul Dossett, Grant Thornton, reported that a decision had been taken to look at Haringey in respect of the high level controls in place. The findings of the review did not guarantee that every statement produced would be accurate, but gave an indication in respect of the overall systems and controls. The Committee noted that all Members were aware of case-studies where things had gone wrong, and Rowann Limond, Homes for Haringey, asked all Members to notify Homes for  ...  view the full minutes text for item 8.

Report of the Assistant Chief Executive, Policy, Performance, Partnerships and Communications to present the findings of a review of partnership working undertaken by Grant Thornton.

Cllr Butcher left the meeting at 20:45hrs.

Eve Pelekanos, Corporate Head of Performance and Policy, presented the report on the outcomes and recommendations arising from the review of Haringey Strategic Partnership by Grant Thornton, which had been undertaken between November 2009 and February 2010. The 12 recommendations were set out in the action plan along with the Partnership’s responses, and all 12 recommendations had been agreed by management, several of which had already been implemented. It was reported that further announcements were awaited from the Government in respect of the future of the LAA and plans for strategic partnerships.

In response to a question from the Committee regarding progress with the agreed action to implement a new data platform, Ms Pelekanos confirmed that this work would enable joint needs assessments and would be of benefit to all partners.

The Committee expressed concern that Members heard very little about the work of the HSP, and that this review had not identified this as an issue. Concern was also expressed regarding the recommendation on private sector engagement, as not all Members felt that private sector engagement was necessary. The Committee asked whether any payment was required in relation to the advice being sought on how best to engage with the private sector, in response to which Ms Pelekanos agreed to seek information on this point and report back.

The Committee also expressed some concern regarding the recommendation on Community Link Forum representation, as it was felt that it was the responsibility of HAVCO to ensure that all delivery agencies were fully involved in the work of the Partnership and that effective involvement did not necessarily require every group to participate directly in the decision making process. Paul Dossett, Grant Thornton, advised that this recommendation had been made on the basis of feedback received, although the most important issue was to increase the number of demonstrable outcomes.

The Chair advised that Committee that although the CAA ratings had been abolished, the need to continue and improve partnership working remained strong and this work should continue. The Chair welcomed the report that all 12 recommendations had been agreed, and noted the deadlines for implementation. The Chair noted the endorsement of the Section 151 officer in the report.

RESOLVED

That the content of the report and the 12 management actions contained in the action plan be noted.

Report of the Head of Audit and Risk Management to inform the Audit Committee of the requirements of the statutory Annual Governance Statement (AGS) and provide a draft statement relating to 2009/10 for review and approval.

Anne Woods, Head of Audit and Risk Management, presented the report on the requirements of the statutory Annual Governance Statement (AGS) and the draft AGS relating to 2009/10. In accordance with the terms of reference of the Audit Committee, the Committee was asked to review and approve the draft AGS. It was reported that the format of the document was prescribed by CIPFA, with the detailed content provided by the local authority. The statement should include significant governance and control issues identified during 2009/10, and any outstanding issues from the previous year. The report included recommendations arising from external inspections. It was reported that it was important that governance and control procedures were embedded, as the external inspection arrangements were changing in 2010/11.

The Chair advised Members that it was the responsibility of the Audit Committee to approve the draft statement before it was presented to the General Purposes Committee with the Statement of Accounts.

The Committee asked about the Data Quality issues identified, and whether any work had been undertaken to establish how the situation had developed in the first place. The Head of Audit and Risk Management reported that the issues had been identified as part of the Joint Area Review, which had looked at the processes from beginning to end as well as the individual actions carried out. The Committee asked about the data quality issues identified in Benefits, in response to which it was reported that these had been identified by the Council’s external auditors and as part of the National Indicator audit work, and that officers had been working to identify and address the fundamental causes of these issues.

The Committee noted the recent ruling against the Council in respect of the equalities impact assessment issues with the Ward’s Corner planning application, as this had highlighted issues in respect of the Council’s equalities impact assessment. Officers agreed to reflect the issue in the AGS.

The Chair asked what steps were being taken in order to confirm that the Council was complying with the relevant guidelines and legislation, in response to which the Head of Audit and Risk Management reported that this was confirmed by the work of internal audit and the external auditors. The Chair asked whether the Head of Audit and Risk Management had looked into the relevant standing orders, standing financial instructions, scheme of delegation and supporting procedure notes and manuals, and the Head of Audit and Risk Management confirmed that this had been done.

The Chair reported that the Audit Committee had received reports on 28 October 2009 and 5 November 2009 regarding the Alexandra Palace and Park governance issues and the Committee had agreed that all the recommendations relating to the APP should be implemented by set deadlines, the final date of which was 31 March 2010. As advice had previously been received from the Head of Legal Services that the Section 151 Officer was responsible for the effective financial management of the Council including the Alexandra Palace and Park, the  ...  view the full minutes text for item 10.

Report of the Head of Audit and Risk Management to inform Members of the overall adequacy and effectiveness of the system of internal control and risk management operating throughout 2009/10 and present a summary of the audit work undertaken to formulate the opinion, including reliance placed on work by other bodies. The report also fulfils the requirements of the Audit Committee terms of reference.

Anne Woods, Head of Audit and Risk Management, presented the report on the overall adequacy and effectiveness of the system of internal control and risk management operating throughout 2009/10, in accordance with the terms of reference of the Audit Committee and the CIPFA Code of Practice annual reporting requirements. The report included the sources of assurance for the overall audit opinion for 2009/10, including external inspections. Appended to the report was a summary of the feedback from senior managers regarding the effectiveness of the system of internal audit.

In response to a question from the Committee regarding the overall findings of the report, the Head of Audit and Risk Management confirmed that there were no significant governance issues which should be included in the AGS. Audit reports with limited assurance had been produced during the year, however these did not have an impact on the overall Audit opinion. The Committee expressed concern regarding priority 1 recommendations that were outstanding, in response to which the Head of Audit and Risk Management confirmed that 95% of recommendations had been implemented fully, and the remaining 5% were in the process of implementation. The Chair reminded officers that the Committee wished for all recommendations to be implemented fully, not just priority 1 recommendations.

In response to a question from the Committee regarding the response rate for the feedback provided by senior managers, it was confirmed that the information was based on 1:1 interviews with 20 senior managers.

The Chair noted the comments of the Chief Financial Officer in relation to the report, and asked how the Council could place confidence in its systems of internal control, risk management and internal audit. The Head of Audit and Risk Management confirmed that this reliance was based on the work of internal audit and the Council’s external auditors. The Chair asked whether the review of effectiveness of the system of internal control received confirmation from a cross-section of senior officers that systems were sound, in response to which the Chief Financial Officer confirmed that this was the case, and that responses had been received from individual departments.

In response to a question from the Chair regarding project management, the Head of Audit and Risk Management reported that resources were available within Internal Audit to undertake reviews covering areas such as terms of reference, project documentation and the compliance framework relating to project work. The Chair requested that a report on Project Management be produced for the Committee’s consideration in order to satisfy Members that everything was being done in the appropriate manner.

On a motion by the Chair it was:

RESOLVED

i)                    That the content of the annual audit report and assurance statement 2009/10 be noted for reasonable assurance, but not absolute assurance.

ii)                  That the annual audit report and assurance statement be presented to the next available Full Council meeting for information.

iii)                That a report on the overall Project Management arrangements be produced for the Committee’s consideration in order to satisy the Committee that project  ...  view the full minutes text for item 11.

Report of the Head of Audit and Risk Management:

i)                    To inform Members of the requirements of the Accounts and Audit (amendment) (England) Regulations 2006 and the action taken to address these.

ii)                  To advise Members of the outcome of the independent review of Haringey’s internal audit service.

Anne Woods, Head of Audit and Risk Management, presented the report on the outcome of the independent review of Haringey’s internal audit service and the requirements of the Accounts and Audit (amendment) (England) Regulations 2006 and the actions taken to address these. The review was undertaken in accordance with the CIPFA Code of Practice, and took the form of a peer review with three other London authorities. The report on Haringey had been produced by the London Borough of Kensington of Chelsea. A recommendation that the review of the effectiveness of Internal Audit should be presented to Audit Committee had been made, and had been addressed by the information provided to the Committee in the previous report on the agenda.

In response to a question from the Chair, the Chief Financial Officer confirmed that she was fully satisfied with the content of the report. Grant Thornton also confirmed that they were satisfied with the report.

RESOLVED

i)                    That the findings of the review which confirms that Haringey’s internal audit service fully complies with the CIPFA Code of Practice be noted.

ii)                  That the actions taken to address the recommendation made be noted.

Report of the Head of Audit and Risk Management:

i)                    To provide a copy of the latest Corporate Risk Register for review;

ii)                  To report on business units’ and departments’ actions to monitor, review and update risk registers in accordance with the Councils risk management strategy.

Anne Woods, Head of Audit and Risk Management, presented the report on the latest corporate risk register and business units’ and departments’ actions to monitor, review and update risk registers in compliance with the Council’s risk management strategy. In accordance with the corporate risk management strategy, CIPFA code of practice and terms of reference of the Audit Committee, the corporate risk register was presented to the Committee on an annual basis. It was reported that the corporate risk register was reviewed on a quarterly basis by the Chief Executive’s management board, and that the Audit Committee received quarterly reports on the implementation of the corporate risk management strategy.

The Committee expressed concern regarding the high likelihood recorded in relation to inadequate financial management and reductions in specific and general grant allocations, in response to which the Chief Financial Officer advised that the likelihood related to the reduction in grant allocation aspect, rather than inadequate financial management. The Committee suggested that these two aspects should be separated into different risks, to make this point clear.

In response to concerns from the Committee regarding the relatively high likelihood attributed to the risk of lack of safety and well-being for clients within child protection services, the Head of Audit and Risk Management advised that the risk remained high while actions from the ongoing action plan were still in the process of becoming embedded. It was reported that improvements had been made, but that there was further progress to be made and that, as this progress was reviewed, the risk would reduce further.

The Committee asked for clarification of the basis on which the assessment of the risks associated with staffing issues was made, in response to which it was confirmed that this was in the context of the impact of reductions in grant funding and Government cuts. Members requested that this background be made clearer in the report, so that the commentary provided supported the scores given.

In response to general questions and concerns regarding how the assessments of likelihood and impact were made, the Head of Audit and Risk Management advised that all the assessments were made on a subjective basis and would change as situations developed.

The Chair advised the Committee that greater detail was provided in the quarterly risk management reports and that it was the responsibility of the Audit Committee to review the corporate risk register once a year. The Chair advised that he had looked into the corporate risk register in detail, and compared it with the previous year’s report. The Chair had asked a number of questions regarding the report in advance of the meeting, and had received a full response from the Chief Financial Officer in respect of these questions. It was agreed that this correspondence would be circulated to all Members of the Committee for information. The Chair thanked the Chief Financial Officer for the response he had received and asked the Chief Financial Officer to confirm that the report and corporate risk register complied  ...  view the full minutes text for item 13.

Report of the Head of Audit and Risk Management to inform Members of the Committee’s proposed annual work plan for the 2010/11 municipal year.

Anne Woods, Head of Audit and Risk Management, presented the report on the Audit Committee’s proposed annual work plan for the 2010/11 municipal year. The report included a summary of the statutory reports and those included in the Committee’s terms of reference, and when these were expected to come to the Committee. It was reported that there were a number of external inspections and follow up reports which could not necessarily be anticipated and which would be added to the work programme throughout the year. It was reported that, at the request of the Chair, an additional Committee meeting had been scheduled for the 2010/11 municipal year.

It was noted that 3-month and 6-months reviews in respect of Leasehold Charges were to be added to the work plan further to discussion earlier in the meeting, and the Chair advised that additional reports on the Housing Services inspection, safeguarding children and vulnerable adults, Health Inequalities, Alexandra Palace and Park, Project Management and Data Quality (together with any other items, metting day to day needs) should also be added to the work plan.

Taking into accounts the additional reports discussed, it was:

RESOLVED

That the annual work plan for the 2010/11 municipal year be approved with the added reports.

To consider any new items of urgent business admitted at item 2 above.

There were no new items of urgent business.

Monday 26 July 2010 at 19:30hrs.

Monday, 26 July 2010 at 19:30hrs.

The meeting closed at 21:50hrs.