Agenda item

The Audit Committee operates under an agreed programme of core business, in accordance with its Terms of Reference as set out in the Council’s Constitution. The Committee is asked to review and note its monitoring report/action log for the 2022/23 council year.

The Committee was asked to review and note its monitoring report/action log for the 2022/23 council year (a copy of which had been filed with the signed minutes).

Members were informed that the International Review report was going through the relevant legal processes.  Extracts of the report had now been shared with those individuals named for comment before being finalised.  It was noted that this was a complex process, but it was hoped that by the middle of April officers would be in a better position to confirm when the report would be available.

Regarding action 5, Councillor Jackson felt that more was needed to be added to the action to ensure members did not lose sight of all the issues identified within the initial report including employment and dismissal practices around senior directors as well as exit packages.  He commented that as an Audit Committee there was a responsibility to ensure that the Council was operating legally, and good governance was being observed.  He briefly spoke about a past exit package which he thought should also be examined.  The Chair responded by confirming there were two pieces of work currently taking place; the further work taking place on individual cases and the substantial review of recruitment and retention processes governing changes to terms and conditions and how employees leave the organisation.  It was advised that the review of recruitment and retention was programmed to be presented to Audit Committee once complete and could be expanded to include more detailed information than a normal summary report, if required.  

J. Willis stressed the need to differentiate the work of Internal Audit on providing assurances around the adequacies of controls and the S151 and Monitoring Officers work to consider the lawfulness of individual transactions.  It was noted that any further transactions that had come to light would be added to their file.  However, she reported that at some point there needed to be a resolution to this issue.  The Council needed to move forward and focus more on the strength of the controls and arrangements in place to safeguard the organisation here and now.  

Councillor Oliver agreed that there needed to be a line drawn but stated the best way to do that was to reach a conclusion about what had happened to ensure controls going forward were robust.  He asked about timescales as these issues had been identified as significant matters within the 2020/21 audit report on the agenda.  He questioned whether External Audit had all the information required from the Council to reach a decision on these significant matters.

C. Waddell, External Auditor advised that first and foremost External Audit needed to ensure that the numbers in the accounts were those that should be there and that there had been no disclosures made that anything was missing.  It was noted that there had been some amendments that External Audit were working through with officers.  The second aspect was to ensure that the numbers within the accounts and the amount being paid out were correct.  It was confirmed that generally External Audit were comfortable with the 2020/21 and 2021/22 accounts.  Regarding the International allowance, External Audit concluded following internal advice, that as long as the Council amended the disclosure within the accounts then there would be no issue in terms of qualification.  A form of words for the disclosure had been agreed.  A similar process would probably be needed once a decision was made on the lawfulness or otherwise of exit packages.  

J. Willis reported that work was taking place to ensure the King’s Counsel (KC) had all the information needed before reaching an opinion on the exit packages issue.  As this would be a separate opinion on each individual transaction it was difficult to give a definitive timeframe.  She advised Members that there were two separate issues for her to consider.  One was to determine if any of the transactions made to individuals were unlawful and secondly if they were unlawful would that then trigger a S114 or 114a report.  Ultimately this was a matter of judgement for the S151 Officer taking into account a whole range of things including the KC advice.  The Monitoring Officer would also need to take into consideration the advice of KC in relation to her Section 5 reporting.  Members were assured that this was being worked though as quickly as possible with the intention that it would be concluded before the new Monitoring Officer was in post in early June.  

The Chair thanked all for their updates and asked that Audit Committee be kept informed of progress made on these issues within Action No. 5.  He commented that an additional meeting of the Audit Committee could be convened if necessary.

Regarding Action No. 2 Councillor Oliver suggested that the Chair of Audit Committee be invited to the next meeting of the Scrutiny Chairs Group.  The Chair stated that he would be happy to liaise with Scrutiny on this issue.

RESOLVED that the monitoring report/action log and comments made be noted.