Meeting documents

To approve as a correct record the minutes of the previous meeting held on 27^th November 2014.

The minutes of the meeting held on 27th November 2014, copies of which had been circulated, were taken as read, and having been approved as a correct record were signed by the Chairman.

Apologies for absence were received from Cllrs John Calvert, John Dyke and Terry Mounter.

In accordance with the Council's current Code of Conduct (adopted July 2012), which includes all the provisions relating to Disclosable Pecuniary Interests (DPI), personal and prejudicial interests, Members are asked to declare any DPI and also any personal interests (and whether or not such personal interests are also "prejudicial") in relation to any matter on the agenda for this meeting.  A DPI is defined in The Relevant Authorities (Disclosable Pecuniary Interests) Regulations 2012 (SI 2012 No. 1464) and Appendix 3 of the Council’s Code of Conduct. A personal interest is defined in paragraph 2.8 of the Code and a prejudicial interest is defined in paragraph 2.9.

There were no declarations of interest.

There were no members of the public present.

The next scheduled meeting of the Audit Committee should be held on Thursday 26^th February 2015 at 10.00 am in the Main Committee Room, Brympton Way, Yeovil.

Members noted that the next scheduled meeting of the Audit Committee would be held on Thursday 26^th February 2015.

The Assistant Director - Finance and Corporate Services presented the report which clarified the changes to the Financial Procedure Rules.

In response to several questions the Assistant Director replied that:

·         With reference to a query regarding the best financial option between the leasing or purchasing of vehicles; the decision was made by using various methods of calculation to find out the cheapest option together with input from the Streetscene Manager.  It was hoped to soon introduce a form of internal borrowing from the capital and arranging a repayment scheme by means of an agreed payment plan;

·         SSDC had already signed up to the Prompt Payment Code. . Prompt payment was critical to the cash flow in small companies, and the certainty of getting paid helped to plan for the short and longer term;

·         With reference to paragraph 2.6(f) the process for Infrastructure Projects had been agreed at District Executive and now also had to comply with the Procedure Rules;

·         With reference to 1.6 and the entry paragraph she would adjust the lettering of the following paragraphs;

·         She would also re-word paragraph 1.1(b) regarding full Council being able to authorise further use of unallocated revenue balances etc;

·         She would also make the wording clearer of 5(i) regarding the process;

·         Since the fire at the council in South Oxfordshire, SSDC contingency plans had been revisited and some changes would be made but in general the current plan was satisfactory.

Audit Committee members were content to approve the recommendation.

RESOLVED: That the Audit Committee recommend full Council to approve the attached Financial Procedure Rules.

The Principal Accountant introduced Mark Swallow of Arlingclose who, with the aid of a confidential power point presentation gave members an insight into: the Background of Treasury Management; Economic Outlook; Bail in Risk and Treasury Management Strategy Statement considerations.  Mr Swallow explained that Arlingclose only advised SSDC but any ultimate decisions were made by SSDC.

During discussion the Assistant Director- Finance and Corporate Services confirmed that SSDC did not invest in any financial instruments that they didn’t understand. She explained that in future investments would be made using larger amounts; current staff levels were appropriate it would just be a case of investing and thinking in a different way rather than the more traditional treasury management of placing fixed term investments in banks.

The Chairman thanked Mark Swallow for the useful update which was reassuring.

RESOLVED: To recommend the Treasury Management Strategy Statement and Investment Strategy for 2015/16 to full Council.

Peter Lappin, Senior Manager of Grant Thornton external auditors presented the progress report and emerging issues, as detailed in full in the agenda.  He made particular reference to the item ‘2020 Vision’, which would present a challenge to local government.

The Chairman thanked the Senior Manager for the usual good report.

RESOLVED:

That the Audit Committee notes the attached report.

Peter Lappin Senior Manager - Grant Thornton presented the report, as detailed in full in the agenda, regarding their findings from the signing off of the Housing Benefit Subsidy claim for 2013/14.

He highlighted the fact that the fees for certification of housing benefit subsidy claims had been reduced to reflect the removal of council tax benefit from the scheme and gave a further explanation of the appeal regarding the extrapolation process with the Department for Work and Pensions (DWP).

He explained further that the calculation of Housing Benefit was a complicated process particularly with regard to earned income and classification of overpayments, it was anticipated that a neighbouring Local Authority should be able to help SSDC officers to produce a report through the Northgate System that could provide analysis which would reduce the potential loss in subsidy for 2013/14.

In the meantime the following actions had already been agreed and outlined in the Grant Thornton report:-

• Improvements to the forms filled out by the Housing Benefits Team to calculate earned income (already completed).
• Further training on the areas outlined (partially completed).
• An information sheet to give the team more guidance (to be completed by the end of January).

·         Further testing on the areas where errors were found (to be completed by the 31^st March 2015).

The Revenues and Benefits Manager, in attendance, said that a lot of work had been carried out in the year and the focus should remain on what work could be done in order to minimalize the errors.  The audit findings were useful in order to be able to work out where the weaker areas were.

In conclusion, the Assistant Director Finance and Corporate Services said that there would always be errors in this type of work but if the suggested Northgate report could be produced, the risks of extrapolation against larger cell values would be mitigated to a certain extent. She confirmed that a committee report would be presented to Audit Committee members with an update of how the issue had been mitigated and the result of the appeal.

The Chairman thanked both Peter Lappin and Simon Garlick who were shortly to leave the employ of Grant Thornton for their work in the past and wished them both luck in the future.

RESOLVED: that the Audit Committee:

(1)        Note the contents of the Certification of Claim Report for 2013/14.

(2)        Note that SSDC is appealing the extrapolation process with the Department for Work and Pensions (DWP).

Members reviewed the Audit Committee Forward Plan and were content to note the contents.

The Assistant Director – Finance and Corporate Services would send the portfolio booklet of property assets to Cllr Colin Winder as requested.