Minutes 29 July 2004

1. ELECTION OF CHAIRMAN

Mr M J Cunningham be elected Chairman for the ensuing year.

2. MINUTES

The minutes of the meeting held on 9 March 2004 were confirmed.

3. DECLARATIONS OF INTEREST

Mr P Joyce declared a personal interest as a Director of F W Marsh Engineering

Mr M Cunningham declared a personal interest as a Trustee of the Riverside Centre

Mr J Howe declared a personal interest as a Trust member of West Wight Sport Centre

Mr M Lloyd declared a personal interest as a family member was employed by Wight Leisure

4. FINAL ACCOUNTS 2003-2004

The Panel received the Council’s Statement of Accounts for 2003-2004. which had been approved by the full Council on 21 July 2004. At its meeting on 21 July, the Council, in line with the accounts new timetable and guidelines, had agreed to give delegated authority to the Audit Panel, as a properly constituted Special Accounts Committee, to consider and sign off the accounts in future years.

Members received detail on the revised timetable that was being enforced in future years. It was also explained that any member of the public was entitled to inspect the accounts for 20 days before they were signed off.

Clarification was sought on the Council’s process of external borrowing. It was considered that this information should be made more widely available. Discussions also took place on the Council’s role in a number of associated companies.

ACTION TO BE TAKEN BY THE CHIEF FINANCIAL OFFICER :

Copies of the statement of accounts leaflet be made available for members of the public in the County Hall Customer Services area.

5. AUDIT AND INSPECTION PLAN 2004/2005

Members received the report of the Audit Commission setting out the audit and inspection work to be undertaken in 2004/2005.

The Panel were provided with a brief overview of the each are involved and were advised that the inspection work focussed on three key areas :

· Improvement – priorities

· Assessment – to deliver improvement priorities

· Assurance

Questions were asked regarding the proposed Private Finance Initiative (PFI) for Highways. PFI’s were considered to be high risk and members were advised that such initiatives needed to be carefully managed. It was explained that the PFI would go through a Gateway Review Process prior to it being implemented

6. STRATEGIC PLAN FOR INTERNAL AUDIT

Consideration was given to the Strategic Plan for Internal Audit which set out proposals for internal audit activity for the three year period 2004-2007.

The Strategic Audit Plan was a result of a planning process which involved both a risk assessment process using a computerised planning system and consultation with stakeholders including Heads of Services and the Audit Commission. The Plan set out the activities to be audited, the audit approach and time required to complete the audit.

Members asked a number of questions relating to the regularity of Audit reviews

The Audit resources were still 30% below the average for Unitary Authorities at 7.6 ftes against the Unitary average of 10ftes. As a consequence only basic audit coverage could be provided and many of the lower risk activities would not be audited over the next three years. It was noted that the Audit Team had made a bid for more resources through the service planning process.

ACTION TO BE TAKEN BY THE CHIEF INTERNAL AUDITOR:

(a) That the methodology used to construct the Audit Plan be endorsed.

(b) That priorities, frequencies and time devoted to areas of Council activity be

supported.

ACTION TO BE TAKEN BY THE PORTFOLIO HOLDER FOR RESOURCES :

The Portfolio Holder for Resources be advised of the Panel’s concern to the ability of the Audit Section to undertake all the activities required of it over the next three years with the current staffing levels.

7. INTERNAL AUDIT PERFORMANCE REPORT 2003/2004

The Panel received the report of the Chief Internal Auditor summarising the performance and future prospects for Internal Audit.

Member were reminded that risk management was being fully included in the approach to audit activities. The benchmarking comparisons highlighted the views expressed earlier in the meeting about the resources available for audit purposes.

8. INTERNAL AUDIT PROGRESS REPORT

Consideration was give to a summary of Internal Audit Activity completed since the last report on 9 March 2004.

The Chief Internal Auditor highlighted the number of recommendations made in respect of each areas investigated. It was commented that following the decision not to externalise Wight Leisure, systems needed to be realigned with the Councils.

In relation to the full audits carried out at a number of Schools a number of common weaknesses in procedures had been highlighted. Members believed that it was important that all Schools were advised of these so that best practice could be adopted.

ACTION TO BE TAKEN BY THE CHIEF INTERNAL AUDITOR :

Any thematic issues arising from full audits undertaken at schools be made available to all schools to encourage best practice.

CHAIRMAN