Agenda and minutes

Items 5 and 6: Personal, non-prejudicial interests were declared by County Councillors P. Murphy, A. Easson and M. Feakins as trustees of Monmouthshire Farms School Endowment Trust Fund.

No members of the public were present.

i)              Officer Call in: Food Procurement follow up

ii)             Officer Call in: Caldicot Castle follow up

1.    Urgent Items of Business

The Chair agreed to consider the following two items of urgent business as an emergency response to the current pandemic. 

a)   Statement from the Chief Internal Auditor and Chief Officer, Resources re: Internal Audit Team standing down to contribute to theTrack, Trace and Protect (TTP) Function

The Chief Internal Auditor and Chief Officer, Resources provided the following statement to inform members of the Audit Committee why the Internal Audit team is temporarily stood down to provide corporate support to the Track, Trace and Protect (TTP) function currently managed by MCCEnvironmental Health Officers.  The statement is as follows:

“TTP at Monmouthshire is being managed by our Environmental Health Officers.  Just before Christmas they were inundated with high volume caseload such that there was a shout out for help and support from internal teams within MCC.

Discussions were held between the Chief Executive and Chief Officer Resources and it was felt that the Internal Audit team would have the appropriate skill set to support TTP.  Consideration therefore had to be given to keeping the Internal Audit team operational carrying out its audit function, providing appropriate assurance on the internal control environment, governance arrangements and risk management process in place or to support a high profile corporate function during these unprecedented times with the continuing pandemic.

The impact of standing the IA team down to support TTP needed to be assessed.

The IA team currently consists of a Chief Internal Auditor (50%), 1 Audit Manager, 1 Principal Auditor, 2 Senior Auditors and 1 Auditor.  The Auditor has already been seconded out of the team to support the Covid -19 business grants administration.

The proposal was for the Chief Internal Auditor to maintain support for the Chair of Audit Committee and provide appropriate reports into Audit Committee, the Audit Manager to retain 40% of audit time, 1 Principal Auditor to retain 25% of audit time with the rest of the team supporting TTP for a 2 month period.  This would allow all current audit work to be reviewed and draft or final reports sent out, to deal with ongoing audit queries and to respond to any allegations of fraud.

To date 25% of the revised audit plan has been completed to at least draft report stage.  When all reports currently under review are sent out 47% of the revised plan will be completed to at least draft report stage.

Although only 3 audit opinions have been issued, they have all been categorised as giving Considerable Assurance.  3 Grant claims have been audited and they have had unqualified opinions which is good and the terms and conditions of the grant had been met.  Of the 7 opinion related audits currently under review, none are anticipated to result in a  Limited Assurance opinion.

Over the past few years, key financial systems audited have received positive assurance opinions; there have been no significant changes to those systems or the management of them and no issues or frauds have  ...  view the full minutes text for item 3.

The Audit Wales Officer introduced the Audit Wales Annual Audit Summary.  A change in format was noted in that this report now replaces the Annual Improvement Report combined with elements of the Annual Audit letters sent to Chief Executives. 

The Performance Manager responded, thanking Audit Wales and reminding Members that the reports mentioned are presented to the Committee during the year with a Management Response that includes actions taken or planned to take account of the proposals for improvement.  The authority uses a ‘Proposals for Improvement Tracker’ to assess progress.

A Member observed that the report states that there are no areas in Monmouthshire that fall into the lowest 10% deprivation and queried this statement as some areas in the county have levels of deprivation.  It was clarified that the comment refers to the top 10% areas of deprivation in Wales, which do not include locations in Monmouthshire.

A Member asked about the review of the Public Service Board (PSB) and asked about the identified constraints to it working effectively.  A response will be provided by Audit Wales after the meeting.

It was clarified that the PSB will work very closely with colleagues in the Corporate Joint Committees for the Cardiff Capital Region to address common issues.

The Committee noted the report.

Items 5 and 6 were considered together.

The Audit Wales Officer introduced the Audit of Accounts 2019/2020 reports for the Welsh Church Act Fund and the Monmouthshire Farm School Endowment Trust Fund.

Welsh Church Act Trust Fund: Overall, an unqualified audit certificate is proposed. Two pieces of audit evidence were outstanding. One, relating to expenditure has been received and approved.  The Committee was informed that the remaining outstanding evidence is a confirmation letter from UBS which is awaited.  The accounts have been approved but the letter will be required to obtain the final certification.

An emphasis of matter paragraph has been added to highlight the uncertainties of valuations and property fund investments. 

Monmouthshire Farm School Endowment Trust Fund: an unqualified report is proposed.  The examination certificate is provided in the report.

The Finance Manager welcomed the unqualified opinions and confirmed that corrections have been made as required.  Audit Wales Officers were thanked for their flexibility and co-operation during the pandemic. 

The Committee accepted the report recommendations noting:

1)    That the Committee reviewed the audited accounts for The Welsh Church Act Fund 2019/20 in conjunction with the Audit Wales ISA260 Audit of Accounts report for The Welsh Church Act Fund.

2)    That the Committee reviewed the audited financial statements for The Monmouthshire Farm School Endowment Trust Fund for 2019/20 in conjunction with the Independent Examination Report for The Monmouthshire Farm School Endowment Trust Fund.

This item considered with Item 5 above.

The Audit Wales Officer introduced the letter sent to the Chief Executive in December to summarise the progress Audit Wales has made to date with its Recovery Planning – Assurance and Risk Assessment Project, and to provide some interim feedback to inform the Council’s ongoing recovery work.  This work will continue during 2021.

The Performance Manager provided the management response thanking Audit Wales for the timely feedback.  The letter focuses on recovery planning but it should be noted that the Council remains mainly focused on the challenges of the pandemic.  It was hoped that the areas of strength identified in the letter provided the Committee with reassurance whilst signposting areas for consideration to include in medium term recovery planning.  Work with Audit Wales will continue and a final report will be reported to Audit Committee when available.

Noting that the letter identifies that some staff struggle with working at home, a Member asked if there was an all Wales overview of the effects of working at home and if a report would be written on this topic in the future.  It was responded that the findings in Monmouthshire mirror experiences of working at home across Wales.  Experiences and circumstances are different for each staff member.  It was a positive step that a Book A Desk facility had been implemented to allow members of staff to book socially distanced working space in County Hall as an alternative to working at home in recognition of the challenges some experience.  The Audit Wales Officer will check if there are plans to publish a summary of all Wales on the impact of working at home. 

The Chief Officer, Resources emphasised the authority’s efforts to engage and support staff throughout the pandemic.  Staff members have been surveyed to assess wellbeing and to seek opinions on home working.  A further survey will focus on wellbeing in order to adjust support mechanisms as necessary. 

A Member noted that the letter highlights the low level of reserves as an area of concern that could make the impact of COVID more challenging.  The Member asked if the reserve levels are adequate.  The Chief Officer, Resources reminded the Committee that Monmouthshire County Council is the least well-resourced Council in Wales hence the low level of reserves.  The authority works within its financial constraints.  The Council Fund is maintained at 4-6% levels of Net Revenue Expenditure.  £1.8m headroom was created in the Council Fund General Balance at the end of last financial year at the start of the pandemic.  The authority was able to move some finances between capital and revenue to facilitate this.  Earmarked reserves have declined and a review of adequacy of reserves will be undertaken with the final draft budget proposals.  It was commented that comfort levels are very high due to the additional costs and income losses arising from the pandemic being covered by Welsh Government.  It is hoped that there will be a further Hardship Fund put into place by Welsh Government to cover additional costs  ...  view the full minutes text for item 7.

The Audit Committee Forward Work Plan was noted.

The minutes of the previous meeting were confirmed as an accurate record subject to the following amendment:

Item 5, para 2 (Self-evaluation): should read : There were eight items in the action plan - the deadlines have not yet been met.

An additional meeting has been scheduled for the 25^th February 2021 at 2.00pm.