Agenda Item No
The Vale of Glamorgan Council
Audit Committee: 17th September 2012
Report of the Head of Accountancy and Resource Management
Draft Annual Governance Statement 2011 - 2012
Purpose of the Report
1. The purpose of this report is to submit the draft Annual Governance Statement for review and to recommend its adoption by the Leader of the Council and the Managing Director.
THAT the Draft Annual Governance Statement for 2011 - 2012 be recommended for adoption by the Leader and the Managing Director.
Reasons for the Recommendations
To provide for a review of the governance framework and the system of internal control, which has been in place within the Council for the year ended 31st March 2012.
2. The Council at its meeting held on 6th May 2009 (minute no. 1083) approved the adoption of a Code of Corporate Governance. The Code describes the Council's commitment to and understanding of corporate governance and outlines the arrangements that the Council has to put in place to ensure ongoing effective implementation and monitoring.
3. Section 4 (2) of the Accounts and Audit (Wales) Regulations 2005 as amended, requires every Welsh local authority to conduct a review, at least once in a year, of the effectiveness of its system of internal control and the governance arrangements with its Annual Statement of Accounts. The production of an Annual Governance Statement is a statutory requirement for local authorities in Wales to support the annual Statement of Accounts.
Relevant Issues and Options
4. The Annual Governance Statement (AGS) should relate to the mechanism used to demonstrate that, during the financial year ended 31st March 2012, the Council had an adequate governance regime in place and all business was conducted in compliance with the existing arrangements. However, significant events or developments relating to the AGS that occur between the balance sheet date and the date on which the Annual Statement of Accounts is signed by the responsible financial officer should also be reported.
5. A draft AGS for the 2011/12 financial year relating to the activities of the Council is attached at Appendix A. It has been drawn up with regard to the Code of Practice on Local Authority Accounting in the United Kingdom. It also has regard to guidance issued by CIPFA/SOLACE in its publication 'Developing Good Governance in Local Government" and the Council's Code of Corporate Governance.
6. The overall Annual Governance arrangements within the Vale of Glamorgan Council for the financial year 2011/12 are considered to be satisfactory. However, issues relating to the continuing challenges facing the Council due to reductions in Welsh Government funding and a significant deterioration in the ability of the Social Services Directorate not only to achieve their set savings target but also to remain within the overall budget set is reflected in Section 11 - Significant Governance Issues of the draft AGS.
Resource Implications (Financial and Employment)
7. The AGS includes the requirement that public money is safeguarded, properly accounted for and used economically, efficiently and effectively.
Sustainability and Climate Change Implications
8. None directly from this Draft Annual Governance Statement
Legal Implications (to Include Human Rights Implications)
9. Production of the Annual Governance Statement is required under the Accounts and Audit (Wales) Regulations 2005 as amended and supports the annual Statement of Accounts.
Crime and Disorder Implications
10. A proper system of internal control provides appropriate measures to prevent and detect crime and disorder.
Equal Opportunities Implications (to include Welsh Language issues)
11. None as a direct consequence of this report.
12. A sound governance framework will support the achievement of all corporate and service objectives.
Policy Framework and Budget
13. The proposals in this report are in accordance with the policy framework and budget.
Consultation (including Ward Member Consultation)
14. No further consultation is proposed.
Relevant Scrutiny Committee
15. Corporate Resources.
Helen Smith, Principal Auditor - Tele: 01656754901
External Audit Manager - Grant Thornton UK LLP.
Alan Jenkins - Head of Accountancy & Resource Management.