MINUTES OF A MEETING OF THE AUDIT AND PERFORMANCE COMMITTEE HELD AT COUNTY HALL, NEWPORT, ISLE OF WIGHT ON TUESDAY, 14 NOVEMBER 2006 COMMENCING AT 6.00 PM

Present:

Cllrs Anne Bishop (Chairman), Ivan Bulwer, Mike Cunningham, Jonathan Fitzgerald-Bond, Barbara Foster, Susan Scoccia

Also in attendance:

Cllrs Tim Hunter-Henderson, Erica Oulton, Andy Sutton, David Whittaker

Officers Present:

David Booth, Roger Brown, Julia Corkey, Astrid Davies, Joe Duckworth, Stuart Fraser, Peter Marsden, Robin McInnes, Sarah Mitchell, Geraint Newton, Rob Owen, David Price, Ged Richardson, Derek Rowell, Keith Simmonds, Bob Streets, Paul Thistlewood, April West, Richard Williams, Paul Wilkinson

34. MINUTES

The Chairman referred to discussions at the last meeting relating to a recent audit review of car parks. Unfortunately the report in the County Press had caused concerns for those staff in the Car Parking Section. The Chairman indicated that the review did not question the honesty of the staff and only highlighted problems with the processes and systems that were in operation at that time.

RESOLVED :

THAT the minutes of the meeting held on 10 October 2006 be confirmed.

35. DECLARATIONS OF INTEREST

There were no declarations of interest.

36. PUBLIC QUESTION TIME

There were no public questions.

37. INTERNAL AUDIT OUTCOMES REPORT

The Chief Internal Auditor presented his report regarding audits completed since September 2006. The audits completed included Electoral Services, Credit Notes, Schools Bank Accounts, School Music Service and a special investigation into income for the crematorium.

Members were pleased to note the outcome of the Electoral Services audit, the School Bank Accounts audit and the School Music Service report. However, there were some concerns regarding the Credit Note report and questions were raised about sufficient resources and staffing. Reassurances were given that sufficient staffing was available and the revised process would ensure a clear audit trail from original invoice to credit note issue.

Concerns were also raised about the circumstances surrounding an outstanding debt of £161,892 at the crematorium. The Committee was advised that the debt had accumulated over two years and involved three subsidiaries of one funeral directing company. The Internal Audit team had investigated and discussed the situation with the company, the crematorium staff and corporate finance staff.

Anomalies had been identified during the change over from the old accounting system to a new BACS system in July 2005. These issues had now been addressed and new processes put in place which ensured that there would be no similar occurrence in the future. The outstanding debt had been settled in full in October 2006.

Members were advised that crematorium staff would receive the necessary training for the Jbase system and would monitor financial activity from invoice through to payment as from February 2007.

RESOLVED:

THAT the report be noted.

38. NEWPORT, RYDE AND VENTNOR HAVEN HARBOURS

The Committee had received a report at the previous meeting and had requested further information regarding the trading position of the harbours coming within the Council’s responsibility.

Members were advised that the differences in operating costs between Newport Harbour and Ryde were partly due to the costs incurred for three members of staff allocated to the Newport Harbour budget. In addition, the Newport Harbour area extended as far as the Folly and was currently prevented from generating further income, partly due to the coach parking situation on the Quay.

The Ryde Harbour area included growing sandbanks and experienced silt accumulation, which had required annual maintenance dredging since 1991 with capital dredging being necessary during 1994 and 2002. Keeping the harbour entrance clear had resulted in a net operating deficit of approximately £40,000 per year. The Council’s Strategic Asset Management Group was currently considering options for the future of Ryde Harbour.

The Committee agreed that each of the harbours were strategically important assets for the Island. Opportunities for future development and regeneration for the landward facilities at Newport and Ventnor were currently being considered, which would assist with additional income for both locations.

Members questioned whether any income was received from the Medina Valley Centre and the Island Harbour and the Coastal Manager agreed to investigate this possibility and provide a written response.

RESOLVED:

THAT the report be noted.

39. IT ASSURANCE – BUSINESS CONTINUITY AND DISASTER RECOVERY

The Audit Commission had undertaken an audit earlier in the year in order to provide assurance for the Council’s IT arrangements. Some issues regarding business continuity and disaster recovery had been identified and the outcomes had informed the report. The audit had provided officers with an opportunity to review current procedures and update the committee on work undertaken during the previous six months. A report was circulated at the meeting by the Head of Organisational Development, which outlined the response to the Audit Commission’s findings and a proposed Action Plan.

Three key actions had been identified and undertaken as priorities which included the power supply to the server farm, improvements to the back up regime and improved air conditioning for the server farm. Current work included improving business continuity (including telephony) systems, improving data networks and ensuring suitable arrangements for replacement servers.

Members raised concerns about the robustness and sustainability of the systems and were reassured that a business continuity and disaster recovery programme had always been in place, but would now be strengthened and improved by the new arrangements. Questions were also asked about the possibility of sharing a remote ‘mothball’ centre with other organisations and the Chief Executive provided an update on a recent meeting with officers from Southampton City Council. The committee was advised that an evaluation would be undertaken, which would include an Island-based solution.

The committee was advised that funds had been specifically allocated to business continuity this year and that the Audit Commission had worked successfully with officers to ensure the Council’s improved Business Continuity and Disaster Recovery strategy.

RESOLVED:

THAT the report and the actions proposed to improve the Council’s IT Business Continuity and Disaster Recovery arrangements be noted.

40. VALUE FOR MONEY ENQUIRY – IW ECONOMIC PARTNERSHIP

The Committee considered the Internal Audit scoping document for the Value for Money Enquiry for the Isle of Wight Economic Partnership. It was suggested that the date for completion be moved to January 2007 to give officers sufficient time to undertake the necessary work.

RESOLVED:

THAT the scoping document be approved subject to the completion date being moved to January 2007.

41. STATEMENT ON INTERNAL CONTROL – UPDATE ON OUTSTANDING ISSUES

The Committee received an update on last month’s report, thereby completing the Council’s Statement of Internal Control (SIC). Members were pleased to note that the Council had been commended for their SIC and it was possible that it could be cited as national best practice.

Members were advised that the outstanding issues from last month had all been addressed.

RESOLVED:

THAT the report be noted and further progress reports be received on action plans at appropriate stages.

42. MEMBERS QUESTION TIME

No written questions had been received. Cllr David Whittaker asked whether people owning more than one property were entitled to a vote in each area. The Member was advised that those owning a residence within different local authority areas were entitled to vote once in each area for local elections. However, for parliamentary votes the entitlement was one vote per person, although that could be exercised in any one of the areas where the person was registered.

43. EXCLUSION OF THE PUBLIC AND PRESS

The Committee was asked to consider the exclusion of the public and press due to the confidential nature of the item relating to Internal Audit Outcomes.

RESOLVED:

THAT under Section 100(A)(4) of the Local Government Act 1972, the public and press be excluded from the meeting on the grounds that there was likely to be disclosure of exempt information as defined in paragraph 3 of Part 1 of Schedule 12A (as Amended) of the Act and in all the circumstances of the case, the public interest in maintaining the exemption outweighs the public interest in disclosing the information.

44. CONFIDENTIAL ITEM – INTERNAL AUDIT OUTCOMES REPORT

The Committee was advised that the ICT and Audit departments had adopted the Control Objectives for Business Information Technology (COBIT) as the Council’s governance framework. The audit had compared COBIT best practice against the Council’s network security.

A number of issues had been identified and a resultant action plan drawn up. Best practice would be achieved once the actions had been implemented.

RESOLVED:

THAT the report be noted.

CHAIRMAN