NOTES OF AN INFORMAL MEETING OF THE AUDIT COMMITTEE HELD ON THURSDAY, 28 JULY 2005, IN COMMITTEE ROOM 1, COUNTY HALL, NEWPORT, COMMENCING AT 6.00 PM

Councillors Present : Mike Cunningham (Chairman), Anne Bishop, Brian Mosdell

Officers Present : Miss Katy Green, Mr Gareth Hughes, Mr John Lawson, Mr Ged Richardson, Mr Bob Streets, Miss April West, Mr Paul Wilkinson

Prior to the commencement of the meeting the Overview and Scrutiny Team Leader explained to members that the meeting was inquorate due to several resignations from the Audit Committee since the dispatch of the agenda. This resulted in agenda item 4 regarding the report on the final accounts 2004/05 being withdrawn to be considered by the Full Council at an extraordinary meeting scheduled for 6pm on Friday 29 July.

All other items on the agenda remained unchanged and members were advised that subsequent actions and recommendations would be taken forward where possible under officer’s delegated powers.

1. ELECTION OF CHAIRMAN

RESOLVED :

THAT Cllr Mike Cunningham be elected Chairman for the day.

2. INTERNAL AUDIT PERFORMANCE REPORT 2004/2005

The Chief Internal Auditor introduced the report which provided the Committee with a summary of Internal Audit Performance for the financial year 2004/5. The report outlined the responsibilities, role and scope of Internal audit and also the role of the Committee. The Chief Internal Auditor highlighted that the service for the year had exceeded its target of productive audit time by 2%, this was a significant increase on previous years performance.

The number of days dedicated to productive audit work had also exceeded target by 30 days. The service had achieved 87% of planned work, this was also a considerable improvement on last years performance.

During questioning, it was noted that the service, compared to other Unitary Authorities was under resourced by 30%. A combination of factors had allowed some temporary staff to be employed. The increase in resources had contributed to some of the service improvements highlighted in the report.

RESOLVED :

THAT the report be noted.

3. INTERNAL AUDIT PROGRESS REPORT

The report of the Chief Internal Auditor provided Members with a summary of Internal Audit activity completed since February 2005. Fourteen audits had been completed since this time and a synopsis of each was presented.

During questioning concern was raised regarding the use of an effective monitoring system once audits had been complete. Members were assured that follow up reviews were done to ensure that services had acted upon audit recommendations. If a group of recommendations had not been acted upon, this would be reported to the Committee on an exception basis.

With regard to Housing and Council Tax benefits of the 48 recommendations made, 47 had been implemented. Following the departure of the service Manager, recruitment difficulties had been encountered. Members were keen to ensure that existing staff be given opportunities to fill the role. It was noted that some training was being done, in an attempt to avoid recruiting through mainland advertising.

Concern was raised regarding the Councils pension scheme, allowing outside bodies to become easily attached. It was explained that there were currently 50 admitted bodies which had accumulated over the last 50 years. To address this a new joining criteria had been written to ensure qualification of admittance was more robust.

The Committee expressed concern that the audit trail for recommendations was not complete and that reporting of this kind was only done on a yearly basis. Officers explained that reporting was done on an exception basis. It was also noted that areas of concern were managed through other reporting mechanisms, such as the Quarterly Performance Management report. The Committee asked for assurance that an Audit trail was established to ensure continued monitoring and that no areas would be missed.

RESOLVED :

(a) THAT the report be noted.

(b) THAT the Chief Internal Auditor ensure that proper monitoring arrangement were established.

4. PRUDENTIAL INDICATORS

The report set out the Prudential Indicators agreed by the Council at its budget meeting on 22 February 2005. The Prudential Code requires authorities to set limits for the financial year on borrowing. As good practise the Audit Commission had advised that this report be brought forward to this Committee.

It was noted that since the 31 March 2005 there had not been any further external borrowing and therefore the Council were well within the set indicators.

RESOLVED :

THAT the position be noted.