Agenda Item No. 10
The Vale of Glamorgan Council
Audit Committee: 22nd September 2014
Report of the Operational Manager - Audit (as the Head of Audit)
Audit Committee - Updated Forward Work Programme 2014-15
Purpose of the Report
1. To present to Members the updated Forward Work Programme 2014/15 for Audit Committee's consideration and approval.
1. THAT Members note the amendments to the updated 2014/15 Forward Work Programme to ensure that all aspects of their core functions are being covered.
Reason for the Recommendation
1. To keep the Audit Committee informed.
2. The Terms of Reference for the Audit Committee are:-
· To consider the external auditor's annual report and other relevant reports and to make recommendations on their implementation to Cabinet and / or Council as appropriate;
· To consider specific reports as agreed with the external auditor and to make recommendations on their implementation to Cabinet and / or Council as appropriate;
· To maintain an overview of contract procedure rules, financial regulations and officers' code of conduct and behaviour and to make recommendations to Cabinet and / or Council as appropriate;
· To monitor Council policies on "Raising Concerns at Work" and the anti-fraud and bribery strategy and the Council's complaints procedure and to make recommendations to Cabinet and / or Council as appropriate;
· To oversee the production of the Council's Annual Governance Statement and to recommend its adoption;
· To review the annual Statement of Accounts. Specifically, to consider whether appropriate accounting policies have been followed and whether there are concerns arising from the financial statements or from the audit that need to be brought to the attention of the Council;
With delegated powers:
· To approve the Internal Audit Charter;
· To approve the risk-based Internal Audit Plan and to approve significant interim changes to the risk-based Internal Audit Plan;
· To oversee the Council's Internal Audit arrangements (including the performance of the providers of Internal Audit);
· To contribute to the Quality Assurance and Improvement Programme and in particular, to the external quality assessment of Internal Audit that takes place at least once every five years;
· To consider and approve the Head of Internal Audit's annual report and opinion, and a summary of internal audit activity (actual and proposed) and the level of assurance it can give over the Council's risk management, internal control and corporate governance arrangements;
· To consider and approve summaries of special internal audit reports as requested;
· To consider and approve reports dealing with the management and performance of the providers of internal audit services;
· To consider reports from internal audit on agreed recommendations not implemented within a reasonable timescale and approve necessary remedial action;
· To comment on the scope and depth of external audit work and to ensure it gives value for money;
· To commission work from internal and external audit;
· To review and determine on any issues referred to it by the Head of Paid Service, Section 151 Officer, Monitoring Officer or by a Director, or any Council body;
· To approve measures to ensure the effective development and operation of risk management and corporate governance in the Council;
· To consider the Council's arrangements for corporate governance and to approve necessary actions to ensure compliance with best practice;
· To approve the external auditor's report to those charged with governance on issues arising from the audit of accounts.
3. The core functions of an effective Audit Committee are:-
· To consider the effectiveness of the Council's risk management arrangements, the control environment and associated anti-fraud and corruption arrangements.
· Seek assurance that action is being taken on risk related issues identified by auditors and inspectors;
· Be satisfied that the Council's assurance statements properly reflect the risk environment and any actions required to improve it;
· Oversee the work of internal audit (including the annual plan and strategy) and monitor performance;
· Review summary internal audit reports and the main issues arising, and seek assurance that action has been taken where necessary;
· Receive the annual report of the Head of Accountancy & Resource Management as the Head of Audit;
· Consider the reports of external audit and inspection agencies, where applicable;
· Ensure that there are effective relationships between external and internal audit, inspection agencies and other relevant bodies, and that the value of the audit process is actively promoted;
· Review the financial statements, external auditor's opinion and reports to Members, and monitor management action in response to the issues raised by external audit.
4. Effective audit committees help raise the profile of internal control, risk management and financial reporting issues within an organisation, as well as providing a forum for the discussion of issues raised by internal and external auditors. They enhance public trust and confidence in the financial governance of an authority.
Relevant Issues and Options
5. In order to assist the Audit Committee in ensuring that due consideration has been given by the Committee to all aspects of their core functions an updated forward work programme for 2014/15 is attached at Appendix A for Members' consideration.
Resource Implications (Financial and Employment)
6. None as a direct consequence of this report.
Sustainability and Climate Change Implications
7. None directly from this report.
Legal Implications (to Include Human Rights Implications)
8. Provision of an adequate and effective Internal Audit function is a legal requirement under the Accounts and Audit (Wales) Regulations 2005 as amended.
Crime and Disorder Implications
9. Pursuing initiatives to prevent, detect and deter crime is encompassed within the terms of reference under which the audit function operates.
Equal Opportunities Implications (to include Welsh Language issues)
10. None as a direct consequence of this report.
11. The work of audit is intended to assist in the achievement of all corporate and service objectives.
Policy Framework and Budget
12. The proposals in this report are in accordance with the policy framework and budget.
Consultation (including Ward Member Consultation)
13. No further consultation is proposed.
Relevant Scrutiny Committee
14. Corporate Resources.
Helen Smith - Operational Manager - Audit Tel: 01656 754901
External Audit Manager - Grant Thornton UK LLP
Alan Jenkins - Head of Finance and Section 151 Officer