Agenda and minutes

Audit and Resources Committee
Tuesday, 13 March 2018 6:15 pm

Venue: Rooms 16 and 17, Eastleigh House, Upper Market Street, Eastleigh, SO50 9YN

Contact: Cheryll Kemsley, Democratic Services Officer, tel: 023 8068 8112 Email:  Sarah King, Corporate Director, Support Services (CFO), tel 023 8068 8011 Email:

No. Item


The Chairman advised that Councillor Lizette Van Niekerk had recently resigned. He wished to thank her for being his Vice-Chair for the last two years, and all the work she did on the Committee; she would be greatly missed. Councillor Atkinson added that she had been a valuable asset to this Committee.


Public Participation


There was no public participation on this occasion.


Minutes pdf icon PDF 65 KB

To consider the Minutes of the meeting held on 13 February 2018.




That the Minutes of the meeting held on 13 February 2018 be confirmed and signed by the Chairman as a correct record.


Declarations of Interest


There were no declarations of interest in relation to items of business on the agenda.


External Audit's Annual Audit 2017/18 Plan pdf icon PDF 5 MB


Consideration was given to the external auditors Annual Audit Plan 2017/18 (Agenda item 5). Paul King, Manager, EY gave a brief overview of the Audit Plan, that summarised the initial assessment of the key risks driving the development of an effective audit for the Council, and outlined EY’s planned audit strategy in response to those risks. He highlighted what were standard risks, and those that were specific to this council (as set out on page 5 of the report), that would receive increased audit focus.


The Accounts and Audit Regulations 2015 had introduced a significant change in statutory deadlines from the 2017/18 financial year, and the timetable for the preparation and approval of accounts would be brought forward, with draft accounts to be prepared by 31 May and the publication of the final accounts by 31 July 2018. These changes would provide challenges for both EY and the Council, and it was important that both worked together. To mitigate any risks from EY’s point of view, it had requested from all its clients, draft financial statements; appropriate staff to be available; and complete and prompt responses. The timetable was set out within their Plan.


Members went through the Plan in depth and asked a variety of questions. They also identified two errors in the report: the second paragraph of key definitions under Materiality (page 23 of the report) should read ‘We have set performance materiality at £0.8m which represents 50% of planning materiality’; and Overall Assessment (page 34 of the report) would be conducted by Paul King and not Helen Thompson.


Members also requested an all-member update briefing on the Housing Programme including the Horton Heath and Woodside Avenue housing projects.


The Chairman thanked EY for a thorough and comprehensive Plan.




(1)         That the Annual Audit Plan be noted; and


(2)         That an all-member briefing be arranged to provide an update on the Council’s housing programme.


Strategic Internal Audit Plan 2018/19 - 2020-21 and Annual Audit Plan 2018/19 DOCX 32 KB

Additional documents:


Consideration was given to the report of the Chief Financial Officer and Chief Internal Auditor (Agenda item 6) that presented the Strategic Internal Audit Plan for 2018/19 to 2020/21, and the Annual Internal Audit Plan 2018/19.


During discussion of the report, Members thought that the overall score rating for the risk index of ‘High’ was valued too high at ‘11+’ and were concerned that Internal Audit was under resourced, especially as Future Eastleigh was still settling down, and sought assurance that the service had enough resources to meet the requirements to carry out the audit function. The Corporate Director – Support Services, advised that if more resources were required, there would not be a problem to do this.


The Chief Internal Auditor explained that the Plan was a ‘fluid’ document which could be amended as necessary, and added that the Annual Internal Audit Plan for 2018/19 would require total resources of 721 days to complete. The remaining shortfall of 55 days would be resourced through a casual arrangement with an experienced Internal Auditor.




(1)         That the Strategic Internal Audit Plan for the period 2018/19 to 2020/21 be approved; and


(2)         That the Annual Plan for 2018/19 contained within the Strategic Internal Audit Plan be approved.


Internal Audit Monitoring Statement for the Period 1 October 2017 to 31 December 2017 pdf icon PDF 186 KB


Consideration was given to the report of the Chief Financial Officer and Chief Internal Auditor (Agenda item7) that provided an update of the third monitoring statement for the current financial year, 2017/18 together with an audit activity, summarised in the appendices to the report.


It was noted that Appendix C to the report required updating and the Corporate Director – Support Services, advised that an updated Appendix C would be circulated to Members.




(1)         That the Internal Audit Monitoring Statement for the third quarter of 2017/18 be noted;

(2)         That the progress made on the implementation of Internal and External Audit recommendations be noted; and


(3)         That an updated Appendix C be circulated to Members.


Verbal Updates from Members Representing Strategic Risk Management Group (SRMG) / Procurement Executive Group (PEG)


(a)         Strategic Risk Management Group (SRMG)


Councillor Irish advised that the Group met on 5 March 2018 and reported the following update:


Risks associated with the Future Eastleigh service redesign programme were being considered by the chair of the new Change and Improvement Board (Natalie Wigman). Some risks would be managed by services, or by the Lead IT Specialist, and others as part of the new Change and Improvement Board (this Board was a parent board to the IT Board.)


Management Team had considered the Corporate Risk Register at their meeting on 14 February 2018 and would have a further discussion on 11 April 2018.


One-to-one meetings had begun with the twelve service managers to convert previous unit risk registers to new Service registers. These meetings were expected to be completed by end of March with new service registers in place by, or just after, the start of the new financial year. A similar approach is working for service-based Business Continuity and Health and Safety.


Risks associated with introducing a new system in Waste Management later this year were being carefully managed and mitigated.


SRMG had considered the issue of insurance: claims and policies; further work would be done to ensure a strong link between risks taken and insurance held by the Council. Working with the Council’s insurers there would be bespoke audit work of high risk service areas and training for key managers (as part of the insurance contract). Members asked for specific feedback at the next meeting.


The next SRMG was 4 June 2018, prior to Audit and Resources on 12 June 2018.


(b)         Procurement Executive Group (PEG)


Councillor Tennent advised that the Group met on 6 March 2018 and reported the following update:


The Group reconsidered the matter of raising the upper threshold for three quotes from £50k to £75k.  Some other authorities had higher thresholds (£100k) but some lower (£25k).  The Group discussed the balance between supporting smaller businesses (for whom a formal tendering process was onerous and off-putting), and best value for the Council (through open and more transparent procurement).  Further analysis would be carried out on current contracts and brought back to the Group.


Officers had visited New Forest to gather further information about operating a procurement system.  Further changes were being discussed to improve the current set of roles and responsibilities in relation to procurement. The Business Partner (Support Services) was arranging further training on administration of the e-tendering system. The Corporate Director – Support Services, advised that an Operational Manager had just been appointed; she had a procurement background and would oversee the processes.


The Group considered how the Council should make use of the Contracts Register.  It was agreed that information on its contracts register should be placed on the e-tendering system to allow better monitoring and earlier identification of contract expiry. All members of the Group were asked to look at the Contracts Register in more detail and submit comments for discussion and decision at the next meeting 9 June 2018, prior to Audit and Resources on 10 July 2018.


Action List pdf icon PDF 51 KB


The Committee considered the Action List, which set out the recent decisions and subsequent actions arising from the Committee.


It was AGREED -


(1)         That the Action List be noted;


(2)         That specific feedback on the Council’s insurance to be provided at the next meeting by the Corporate Director – Support Services; and


(3)         That Members receive an update on the Council’s Housing Programme prior to a Full Council meeting after the May elections.


Forward Plan pdf icon PDF 64 KB


The Committee considered the current Forward Plan of Key Decisions.


It was AGREED -


That the current Forward Plan be noted.


Work Programme pdf icon PDF 54 KB


The Committee considered its current Work Programme.


It was AGREED -


That the Work Programme be noted.

Chairman's Closing Comments

The Chairman thanked Councillors Atkinson, Irish, and Tennent for attending the SRMG and PEG over the last year, and other members of the Committee, staff, and EY for their advice and guidance; it was much appreciated. He wished the best to everyone standing in the Borough Council elections coming up in May this year.


The Chair added that following the sad news of the passing of former Councillor Cossey, his funeral would be held on Thursday 29 March at Wessex Vale Crematorium at 3.15pm. The family had requested family flowers only with donations to Leukaemia Research.  Cheques should be made payable to the charity and could be sent to Eastleigh Funeralcare, 10 High Street, Eastleigh SO50 5LA.


Members then thanked Councillor Holes for chairing the Audit and Resources Committee for the past few years and wished him well also.