Scottish Borders Council

Agenda and draft minutes

Venue: Council Chamber, Council Headquarters, Newtown St Boswells

Contact: Eielen Graham 01835 826585  Email:  eegraham@scotborders.gov.uk

Items
No. Item

AUDIT & SCRUTINY BUSINESS

1.

Minute. pdf icon PDF 99 KB

Minute of Meeting of the Audit and Scrutiny Committee held on 13 May 2019 to be approved and signed by the Chairman. (Copy attached).

Minutes:

There had been circulated copies of the Minute held on 13 May 2019.

 

DECISION

APPROVED for signature by the Chairman.

 

2.

Action Tracker pdf icon PDF 72 KB

To note progress made on the Action Tracker.  (Copy attached).

Minutes:

With reference to paragraph 2 of the Minute of 13 May 2019, there had been circulated copies of the Action Tracker for the Audit and Scrutiny Committee.  It was noted that the provisional date for the informal session on the Treasury Management Strategy remained as scheduled for 25 November 2019.  Once received from Officers, any updates on the Risk Management Services and the progress on the speed bumps in Langlee Drive would be added to the action tracker.  Mr Robertson reported that the briefing note and joint performance report for Council was still ongoing.  Ms Stacey advised that any progress following today’s meeting would be added to the action tracker and any items marked as completed would be removed.

 

DECISION

NOTED the Action Tracker.

 

AUDIT BUSINESS

3.

Unaudited Reports and Accounts 2018/19 pdf icon PDF 261 KB

Consider various unaudited annual reports and accounts by Chief Financial Officer prior to their submission to the External Auditors.  (Copies attached).

 

Additional documents:

Minutes:

3.1     With reference to paragraph 5 of the Minute of 26 June 2018, there had been circulated copies of a report and associated papers by the Chief Financial Officer on the draft Annual Report and Accounts for Scottish Borders Council, Scottish Borders Council Pension Fund, Common Good Funds, Charitable Trusts, Bridge Homes LLP, SB Supports LLP, SB Cares LLP and Lowood Tweedbank Ltd..  The report provided the Audit and Scrutiny Committee with an opportunity to scrutinise the draft Annual Reports and Accounts for the year ended 31 March 2019 for Scottish Borders Council and associated Group Accounts prior to submission for External Audit Inspection by the statutory deadline of date of 30 June 2019.  The report summarised the financial transactions for 2018/19 and the balance sheet positions as at 31 March 2019 as set out in the Local Authority Accounts (Scotland) Regulations 2014.  In addition, Section 12 of the Local Government in Scotland Act 2003 required annual accounts to be prepared in accordance with proper accounting practice, primarily comprising the Code of Practice on Local Authority Accounting in the United Kingdom 2017/18 and the Service Reporting Code of Practice 2017/18 supported by International Financial Reporting Standards (IFRS).  The Pension Fund Accounts were required to adhere to the Local Government Pension Scheme Amendment (Scotland) Regulations which specified what must be contained in the Annual Report and Accounts.  The Common Good and Trust Reports adhered to the Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing accounts in accordance with the Financial Reporting Standard for Smaller Entities (FRSSE), the Charities and Trustee Investment (Scotland) Act 2005 and the Charities Accounts (Scotland) Regulations 2006 (as amended).  Following audit and a public inspection period the finalised Audit report and Audited Accounts would be submitted to Council in September 2019.

 

1.2      The Chief Financial Officer then summarised Scottish Borders Council draft reports and accounts by means of a presentation.  He detailed the 2018/19 highlights which included – a Revenue out-turn of £1.302m underspend; and £16.414m of Financial Plan savings delivered, of which 71% was recurring.  Net Assets (excluding Pension Fund liabilities) had increased by £6.2mm net on the Balance Sheet.  Capital Expenditure was £47.8m with Fixed Asset NVB of £552.2m.  The presentation included the requirements under the Local Authority Accounts (Scotland) Regulations 2014 and the Council’s own Accounts timetable.  The Chief Financial Officer advised that the Council’s Audited Accounts would be available for public inspection for a 14 day period from 1 July and were required to be published on its website no later than 31 October 2019.  The presentation included an analysis of Revenue Expenditure by department and a breakdown of how efficiency savings had been achieved.  An increased turnover of £1m or 6.6% to £16.2m was reported in respect of external trading by SB Contracts and Members noted that this was as a direct result of a continuing challenging external market.  Mr Robertson went on to explain the - Statutory Accounting Adjustments; General Fund Balances; Balance Sheet overview;  ...  view the full minutes text for item 3.

4.

External Audit Interim Management Report 2018/19 pdf icon PDF 238 KB

Consider report by Audit Scotland on interim findings from their review of Key Systems of Internal Control in connection with their audit for the year ended 31 March 2019 and associated Management Action Plan.  (To follow).

 

Minutes:

With reference to paragraph 6 of the Minute of 26 June 2018, there had been circulated copies of an Interim Management Report by Audit Scotland for the year 2018/19.  The report summarised the key issues identified during the year and included testing key controls within the Council’s financial systems to gain assurance over the processes and systems used in the preparation of the annual accounts.  In addition, Audit Scotland had carried out early substantive testing of income and expenditure transactions. The findings would be used by Audit Scotland to determine its approach during the 2018/19 financial statements audit.  Further work had been carried out on the wider dimension audit of reviews.  Mr Haseeb advised that some control weaknesses had been identified during the audit as summarised in Exhibit 2 within the report.  The Management response/action plan in each case was also included in the report.  Officers clarified a number of points raised by Members andMr Haseeb confirmed that Business World ERP was, in the main, delivering what was expected.  There were, however, some aspects of the system that were not yet fully operational but the Chief Financial Officer confirmed that work was ongoing with CGI to resolve these issues within the contract.  Mr Haseeb also highlighted the testing carried out on non-domestic rate (NDR) reviews and the risk that the reductions were no longer appropriate for some businesses and that the correct amount of NDR was not being collected.  Ms Stacey advised that it had been highlighted to Management, during a recent Internal Audit review, that account reviews be actioned and assessed on a risk basis.  It was noted that the Committee had a continuing role to scrutinise the risks highlighted in all areas of Council business.

 

DECISION

NOTED the report.

 

5.

Audit and Scrutiny Committee Annual Report 2018/19 and Annual Self-Evaluation pdf icon PDF 105 KB

Consider the Audit and Scrutiny Committee Annual Report 2018/19 on their work for the year in fulfilling their Audit remit based on their annual self-evaluation.  (Copies attached).

Additional documents:

Minutes:

With reference to paragraph 9 of the Minute of 26 June 2018, there had been circulated copies of a report by the Chief Officer Audit and Risk providing Members with the Audit and Scrutiny Committee Annual Report 2018/19.  The report noted that the outcome of the self-assessments was a high degree of performance against the good practice principles and a medium degree of effectiveness.  Ms Stacey explained that the report also incorporated the Committee’s performance in relation to the terms of reference and the effectiveness of the Committee in meeting its purpose and that it fully complied with best practice guidance as a foundation for sound corporate governance for the Council and the annual self-assessment using the CIPFA Audit Committee Guidance.  The report noted that the Committee complied with best practice guidance on Audit Committees to ensure it demonstrated its effectiveness as a scrutiny body as a foundation for sound corporate governance for the Council.  It was also noted that the outcome of the self-assessments, carried out during an informal session on 11 March 2019, highlighted a high degree of performance against the Good Practice Principles and a medium degree of effectiveness, the latter which recognised improvement which had been implemented during the year.  This was considered to be the result of the familiarisation of the Committee’s role and the audit reporting cycle.  Ms Stacey confirmed that the Audit and Scrutiny Committee Annual Report 2018/19 would be submitted to Council in August 2019 to provide assurance that actions would be completed to improve effectiveness and to submit proposals for amendments in relation to the terms of reference of the Committee.

 

DECISION

 

(a)     APPROVED the Audit and Scrutiny Committee Annual Report 2018/19 which incorporated its self-assessments using the CIPFA Audit Committee guidance; and

 

(b)     AGREED that the Audit and Scrutiny Committee Annual Report 2018/19 be presented to Scottish Borders Council in August 2019, to provide assurance that actions would be completed to improve effectiveness and to submit proposals for amendments in relation to the terms of reference of the Committee, and published on the SBC website

 

SCRUTINY BUSINESS

6.

Scrutiny Work Programme Update pdf icon PDF 49 KB

Update on current Scrutiny Review Programme and consideration of the 2019/20 Programme.  (Copy current programme attached).

Minutes:

With reference to paragraph 3 of the Minute of 24 September 2018, there had been circulated copies of the Scrutiny Programme for 2019/20 with suggestions for future Scrutiny reviews to be approved by Council.  It was noted that presentations on Community Access to Schools and ALEOs/Live Borders would be at the next meeting on 22 August 2019.  Members were asked to consider further subjects for inclusion on the list for presentation at future meetings of the Committee.  

 

DECISION

AGREED to:-

 

(a)       note the Scrutiny Work Programme 2019/20;

 

(b)       request that Members of the Committee bring forward by 22 August, any subjects for inclusion on the Scrutiny Work programme;

 

(c)       request that officers liaise with communities/the public to advertise Audit and Scrutiny work and asks that they forward any items they wish to be considered for the Committee’s consideration; and

 

(d)       request that a private report on Non-Disclosure Agreements be presented to a future Audit and Scrutiny Committee. 

 

 

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Scottish Borders Council

Council Headquarters Newtown St. Boswells Melrose TD6 0SA

Tel: 0300 100 1800

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