Transcript

Good evening, everyone. Welcome to the Audit Committee. My name is Councillor Haran Mian, I am the chair of the committee. This meeting is being webcast live on the Council website. I will now ask the committee members present to introduce themselves. Can you also state any declaration of interest that you may have in the agenda items and the nature of the interest. So I'll start from the right hand side. Okay. I'm Jill Bailey, the head of legal safeguarding and I'm here from legal. Councillor Abdulmali, welcome to be done. Councillor Kabir Ahmed, no DPI's. Hi everyone, Councillor Ayman Rahman, no DPI. Jill O'Lorraine, corporate director of resources. Viraza Qasim, director of finance. Andy Graham, procurement director. David Dobbs, head of internal audit. Steven Reed, the council's newly appointed external auditor from EY. Ernst and young. Steven Reed, the council's newly appointed external auditor from EY. Philip Simkins, one of the appointed inspectors by the Secretary of State, undertaking the best value review of 2021. Philip Simkins, one of the appointed inspectors by the Secretary of State, undertaking the best value review of 2021. Thank you. Councillor Mark Francis from both East Ward, no DPIs. Mafida Bustin, Councillor for Ireland Gardens Ward, no DPIs. Councillor Asma Begum, Bow West Ward and I have no DPIs. And I'm Fahana Zia, committee officer, supporting the audit committee. Those who are joining from home or online, can we have an introduction from them? So, Hayley Clark, I'm also a partner from EY, so I'll be supporting Steven on the external audit for the coming year. And I'm a senior manager from EY, working with Steven and Hayley. Thank you for the introduction. Can I just ask those members who are newly, can I welcome them from the left side, Councillor Asma Begum and Councillor Mark Francis, and on the right, Councillor Abdul Malikiwe and Councillor Amina Rahma. Thank you. We look forward to all your contributions. Now, apologies. Are there any? No, Chair, I've had no apologies. Now, to the items of the agenda. Item number one, appointment of a vice chair. As this is the first meeting of the municipal year 2024/2025, I would like to ask if there are any nominations from committee members for a vice chair. Okay, can I have a nomination, please? Malikiwe, yes, please. Amina Rahman, the vice chair. Can you use your mike? Yeah, sorry. Amina Rahman, the vice chair. Okay, we have a -- [inaudible] Sure, I'm Charlotte Webster, the independent person and nothing to declare. Thank you. Sorry for late. That's okay. So, as I said, appointment of a vice chair, so we did get, can you say that again, please? I request Amina Rahman, the vice chair. Are there any more nominations? Okay, no. Can I have a seconder for that, please? Yeah, [inaudible] Okay, so there's no other nominations, so now, Allah, because Amina, welcome. So, would you like to come here? Okay, thank you, welcome. And then you are appointed as a vice chair of this committee, thank you. So, does the committee agree to the appointment of a Councillor, Amina Rahman, as a vice chair? [inaudible] Okay, now we are moving on to the minutes of the previous meeting held last month. Can I invite members to approve the unrestricted minutes of the meeting held on the 23rd of April 2024 as an accurate record of proceedings? [inaudible] I think Councillor and myself were the only two people present, so I'm happy to agree. Oh, Charlotte, you were there, right? Yeah, yeah, Charlotte. Yeah, yeah, yeah. So, yeah, I'm happy to agree. Okay, thank you. So, moving on to item four, audit committee terms of reference, membership quorum and dates of meeting for 2024/2025. Can I, at this point, invite Farhana Zia, Democratic Services Officer, to introduce the report? Yeah, hello, good evening. So, this terms of reference report is done annually. It sets out the terms of reference for the audit committee, membership, as well as the dates of meetings. So, it's for members to approve and also agree that the start time for your meetings will be 6.30. It's just an exception that today's one was at 7 p.m. Thank you. Well, I'm happy to agree. Yes, okay. Okay, I can see two hands. Okay. Off to the busting, please. Thank you, Chair. Just wanted to comment on the terms of reference, so I'm pleased to see that the membership has been changed. So, we've adopted part of the guidance that we discussed in previous meetings. So, glad to see that's adopted and I hope we can come back to that during the course of this administrative year as well to see if we can strengthen it even further in line with the guidance. I did have a couple of requests for changes of dates only because I can't make the 18th of July and there's a couple of clashes with development committee and, as you know, I do love audit and I would also equally love development and I wouldn't want to miss either. So, obviously, the municipal calendar is reviewed by Council back in March and then again reviewed and approved in May. So, you know, we try our best to avoid clashes, but that's not always possible. It is the set date. I'll take it back and I'll see what I can do with my colleagues to do that. But, yeah, I mean, it is the date that it will meet at the moment. We'll see what we can do. Yeah, thank you for that. Now, Councillor Mark Francis, please, your question or your query. Thank you. It's nice to be back on the audit committee. Shame I've missed it for the last three years, which have probably been amongst its most interesting times. I wanted to just ask a question just to follow up on Councillor Busting's question about membership, though. So, my recollection is that the LGA peer review recommended that the Council should review the current arrangement of cabinet members sitting on audit committee. And, obviously, I think the lead member for finance sitting on was especially kind of a concern and he isn't now, though, presumably welcome to attend. And another cabinet member has gone as well. But we do still have a cabinet member on the committee. So, I just wondered if there's any reflections from you as chair, whether this is something that this is the position now or are there likely to be more changes? Thank you for that, Councillor Mark Francis. As far as I'm aware, this is the position at the moment. So, I'll ask legal to, if you can highlight on that, if this is all okay, according to the legal side. This was discussed when we talked about the changes and the view of the committee by majority was that this would be the structure that they wanted to follow. But, obviously, the LGA guidance is something which we should continue to bear in mind, so it can certainly go on to the agenda for work to be considered during the year. So, I guess my question, I understand that there were discussions last time about the composition overall. But in terms of the principle, I guess, of cabinet members, including cabinet members who have financial responsibilities being included in the audit committee, I think that's really the point. It's not best practice, but it's not unlawful. So, thank you for that. As I was part of the previous committee and part of the discussion that took place, I think we went through various different examples of how this committee was formulated. Which included cabinet members in certain councils being involved, the number of cabinet members, as well as the size of the committee and a number of other factors within that. At the end of the debate, each item was voted on by the committee and it was the committee's decision to allow one cabinet member on the committee at the time. This is the position we are in. I hope that clarifies your concern. Do you have any other questions? So, just really to follow up, I've got nothing against Councillor Kabir. I'm sure he'll make a really good contribution on here. I do think, though, there's an important principle, which is presumably part of why this is reflected in best practice. Is that cabinet members sit on one side of the table and the audit committee sits on another. So, I would say, I would fully acknowledge that cabinet members sat on audit committee. One or two might have sat on audit committee prior to May 22. But, obviously, that was before the LGA peer review, which specifically highlighted this. But, you know, if that's what was voted on by the majority group, then so be it. Thank you. Just a further declaration. Although there may be papers related to my portfolio as a cabinet member, when I sit here as a committee member of the audit committee, I sit here as a member of the audit committee and not as a cabinet member. Thank you. Now we are moving on. Item. Before you do, just make sure that they've agreed. Before moving on to item 5, can I ask everyone to note the terms of reference, quorum membership and dates of future meetings as set out on the Appendices 1, 2 and 3 and to this report. Number 2, determine the preferred time in which the scheduled meetings will start, which is 6.30. Moving on, item 5 is EOI items for considerations. Can I kindly invite officers from EOI who will be taking over from Deloitte to introduce themselves. They've done that, so I'll ask now for, I think, according to my paper, Stephen Ray. Yes. Can I ask you for your report, please? Thank you, chair. It's an update, I guess, in terms of where we are. So we have all introduced ourselves. We have now commenced the initial planning discussions with officers. We had a discussion earlier this week preceded by an introductory discussion previously. But now that the independence process has been completed and that has been agreed, we're now planning the audit with the intention of bringing a provisional plan for the 23/24 external audit to the 18th of July meeting which you referenced earlier. Does the committee have any questions or comment it wishes to ask at this stage? If you could put your hand, please. Your question, please. Thank you, chair. I just wanted to ask if you've got a robust handover in relation from Deloitte's or if there was any sort of intermediary work from contracts expiring with Deloitte's and you taking over. If there are any gaps and our officers, also questions to our officers in relation to this, are we in a strengthened position so that there won't be any gaps in terms of the accounting process to be carried over? Okay. Yeah. Stephen. Thank you, chair. So in terms of the discussions and the handover process with Deloitte, we have had some preliminary discussions with Deloitte. And as part of the process for the planning of the audit, now that we have formally commenced that, we will have subsequent more detailed discussions with them. Clearly our responsibilities start from the 2023/24 financial year and Deloitte retain responsibility up to 22/23. But in terms of the process to date, chair, there's no concerns that I need to bring to the committee's attention in terms of the cooperation between Deloitte and ourselves. Okay. Thank you for that. I can see you. Do you have any supplementary? Thank you, chair. So the key thing I wanted to focus on is assumptions because some auditors may not accept assumptions by other auditors previously, which then would cause a lag in terms of what the bigger numbers are and what the aturists put forward in terms of numbers. So, I mean, I think as a committee, we would appreciate if once that final conclusion is done in terms of handover, if both officers could inform us if it was to move or if there were gaps in relation to the assumptions that will then be carried over to 23/24 onwards. Stephen, yes. So thank you, Councillor. So under auditing standards, we're required as incoming auditors to carry out certain procedures, and that includes reviewing the files of the outgoing auditor in terms of the work that they've completed. Now, clearly, local audit is in a different position than it was when the last contract changed. And clearly, as far as I understand it to date, Deloitte will not have completed the 22/23 financial statement audit, and therefore that review of the predecessor auditor files will be impacted by that. In terms of auditing standards, we're also, as you indicate, required to consider the assumptions which officers make and the judgements which officers make in the production of the financial statements. And as is normal, we will report our findings from that in our audit results report, which will come to the committee once we have concluded the audit. The audit plan that we present to the committee will highlight those areas where, as auditor, we consider represent the most potential risk to a material misstatement within the financial statements. Thank you, Stephen, for that. Are there any other members who wish to ask any questions? No, okay. Stephen, thank you. So you're welcome to stay for the rest of the meeting, or you can go home and have a cup of tea. Thank you. Thank you for coming. Now, Agenda 6.1, items for consideration. Annual government statement 2023 and 2024. Can I kindly invite David Dobbs to present this report, please? You have 10 minutes. Thank you, Chairman, and good evening, everyone. So this is the annual government statement for 2023-24, the year just passed. And a reminder for the uninitiated that in October 2023, this committee approved the AGS, the annual government statements for 2021, 21-22, and 22-23 in one fell swoop, which remediated the significant backlog of statements that had built up over some time. So as I undertook at that meeting to be back in tandem with the timing for the closure of the accounts, we are now back fully in synchronisation with the accounts closure timetable and with the expected timetable for delivering this document. So that's good news. The document itself is an important expression of the Council's corporate governance arrangements, and it sits within the statement of accounts. But just in brief, it references a number of the Council's corporate governance arrangements. It includes reference to the changes in the arrangements for this audit committee, which we discussed some moments ago. It includes reference to inspection work that's been undertaken since the 1st of April 2023, the updates from my team, the updates in relation to progress on the external audit in terms of signing off the accounts, but also the handover between Deloitte and EY. It also includes reference to the LGA corporate peer review and the best value inspection, which is ongoing. Most importantly, the document also includes reference to the committees which took place last week, and I'm referring there to the significant reports that went to Cabinet and the HR committee on Phase 2 of the Council's People First transformation. So there's reference to those documents in here, so it's completely up to date. At the back end of the document, I think starting on page 29, you'll see two tables, and I'd like to draw the committee's attention to these two tables. The first table relates to the issues that were raised in last year's AGS, which we approved at the October meeting, and it shows the progress being made in relation to those issues. So that's following through in terms of the audit trail, what issues were previously disclosed by directors, and what the current status of those is in terms of remediation. And the second table relates to the issues which directors have chosen to disclose as part of the assurance processes for this year's AGS. So you'll see there the issues that have been raised for this year, these are the issues that directors have put forward in terms of their assurance statements. They've been collated by me and synthesised into this document. The overall document and this statement, as you'll notice, subject to final approval and sign off by the Chief Executive and the Mayor. So subject to approval by this committee, that's where it will go next, and it will then form part of the draft accounts booklet for 23/24, and I believe the draft accounts are also on track for publication very soon. Thank you, Chairman. I'm happy to answer any questions. Thank you, that's very good news. Can I ask members if they have any questions to ask? Okay, Councillor Mofidabastian, please, your question. Thank you, Chair. I've got a few sort of comments on AGS, David, and I suppose overall there's a few points, I think, of clarification within here that aren't necessarily clear. On reading it, I felt it left it a little bit unbalanced, if I'm going to be totally honest. So there were things like on your internal audit assessment, for example, where you mentioned that it is reasonable/limited, and I just wondered whether that needs more explanation. Is it one or the other, or is it a holding comment? There are also points in the report, so if we look at the LGA corporate peer challenge, for example, it's like all the positive commentary has been taken out of that, but none of the criticism has been included. This is on page 25. So it just feels like, if I'm going to be honest, it felt like a bit of a PR exercise. And similarly, thank you, similarly on page 26, the paragraph relating to the best value inspection doesn't really talk about why. It sort of just says it's happening, but doesn't really give any background, which I think is really important if this is a public document as well. And then I've got some really specific questions, which I can go through if you like here. I can speak separately to you then. OK, let's have the main one first. David Dobbs, yes, can you comment on those concerns? Yeah, the council is quite right. So in terms of the internal audit opinion, that's subject to clarification, so it will be limited assurance or reasonable. That has yet to be formulated by my team. So that's why it's in there. That's the one element of this which is currently incomplete. So we hope to be in a position to, well, we'll deliver our opinion at the July meeting of this committee, but it will be, you know, it will be formulated prior to then and included within this document. I mean, I think in terms of the other points, you're quite right. It is a public document. It's not designed to be particularly exciting or a PR exercise, so it is slightly anodyne. The wording we've chosen strikes a balance and it's been amended and reamended following various comments. But I'm quite happy to have a discussion and take on board any specifics in terms of recommendations to how we can improve the wording and ensure it sort of puts the council in its best light to the extent that it can be in this document. Yeah, if you wouldn't mind. So first of all, just to emphasise what David said, this comes here not as a rubber stamping exercise. In a fixed form it comes here for a reason, and that is to get comments from members of the Order Committee so that you are satisfied and we will reflect them. And just to pick up directly on one point specifically, the best value and the reason it's happening, I wish I knew. But maybe when I asked that question, I was told that inspectors aren't told why. They're to go into an organisation, simply they're told that they should. So if there is a reason that anyone can tell me, I'll be more than happy to put it in the report. Do you want to just broadly say a few more? And then we'll come to Councillor Mark Francis. Sure. I'll rattle through them. I mean, there is a letter from the Secretary of State, so that would be my first point that I would go to. So page 31, it says all corporate directors have signed assurance statements confirming their accountability for delivering the respective savings. So I wanted to just understand what consequence is there. So they've signed those assurance statements. But what happens if they don't actually deliver those savings? Because a loan signing a statement isn't necessarily a control or an effective control. There's another comment in the same page around significant provision has been made to accommodate financial risk. So I just wanted to know what the number was. It talks about further on page 33, the number of agency staff. So this relates to the waste service that have been transitioned to full time. And it says it will reduce agency spend on waste budgets, but doesn't talk about the overall saving. So is there an actual increase in there will be an increase in salaried staff. But what's the trade off, I suppose? And yeah, let's have a look. It's quite a bit, isn't it? So, okay, we'll give you another chance. Okay, Mr. Davis, please, if you can address those two issues. Yeah, I mean, I think in terms of insurance statements, you're talking about the budget process, but we also have the insurance statements for this document. So I mean, in terms of insurance, we would never expect that to be absolute. It's, you know, in terms of the finance process, it's another thing which helps ensure that corporate directors feels if they are being and they are being properly held to account. So it just acts to augment, I think, existing control processes in there. But we're not saying it's perfect or it's absolute, but it's a good additional mechanism that's been introduced and is used by the council. I think in terms of some of the comments on the wording, just to be clear on this, I'm sort of a in terms of the stems, I'm a receptacle for information. So I take information from corporate directors and I will challenge it and I will sense check it. And depending on how those conversations evolve, I will then include it within this document. So much of the wording is outside my direct control. So in terms of some of the commentary, particularly that in the table, that comes from the corporate directors assurance statements. Now, I don't just take it blindly, I will challenge and say is this correct or is this balanced, but I appreciate people will have different views on that. And as I said, I'm quite happy to take comments on board and that's obviously the purpose and the mechanism of this committee, Chairman. Thank you. Do you have any final or are you happy with the two more? Okay, okay. Thank you, Chair. You're very generous, thank you. So the other points are really around the financial sustainability of the waste service and the comment around the financial risk of the leisure centre management. And I just felt some numbers with that would be really helpful for context as well. And then the last thing was really around the conclusion, which I don't really know what the conclusion is saying. I think it probably needs a bit more sort of strengthening around, you know, are we saying that there is good governance in place? Are we saying that there isn't good governance in place? What are we actually, what are we concluding out of all of this was my comment. Thank you, Chair. Thank you. David Doves, can you come in, please? Yeah, again, thank you for the comments. I mean, we can take those away and look at them and I'm quite happy to, you know, to discuss separately with the councillors to try to find a, you know, some words that better reflect what we've just been discussing. We can certainly insert some numbers in there and look at sharpening in the conclusion, Chairman. So, okay, thank you for the questions. Councillor Mark Francis, your question, please. Thank you very much. So, I mean, maybe questions, but maybe more comments because it seems like there's an opportunity for feedback and maybe this is that we might see something different. So, first of all, I mean, I appreciate what you said about that you're incorporating a lot of feedback from individual corporate directors and understand that point and also really do. This is a well-written report. It's a well-argued report and to your credit for doing that. I think, like Councillor Busting, I think that this is a report which, as you kind of described it, as putting the council in the best fight and that is what it does. And I'm not sure that that is what I'm kind of comfortable signing off ultimately. So, as context for this, four years ago, Charlotte reminded me that I was on the committee four years ago and the discussions that we had around various things. And one of those was that I refused to vote to sign off an annual governance statement, which was really overly positive about the council and not honest and frank enough about the weaknesses, the challenges and the things that need to happen going forward. And I'm in a similar position with this document, if I'm honest. If I look just towards the bit on our page 25 that says around the LGA's corporate peer challenge, this entirely cherry-picks elements of that. And, you know, we might in a council chamber choose on either side of the political parties might choose which bits we want to reflect on. But this document, which is supposed to represent the views of this committee collectively, needs to be more balanced in this. It needs to incorporate the really quite tough criticisms of the authority and the way that governance is being conducted, the implications that has for service delivery as well. The LGA peer review was very clear about that and we shouldn't shy away from including that in this. I think, you know, you will find many examples which are not good examples to follow. But I would really strongly encourage us to be honest about that aspect. Second thing I want to say is around the best value inspection itself. So I don't think that this being on page 20 of the document is quite kind of sufficient in terms of drawing attention to it. Whether people feel that they do or don't know what are the reasons why the government has sent an inspection team in isn't really the point. The point is that the Secretary of State has chosen to make that decision based on the advice of officials in Whitehall. And we need to be quite frank about that. I mean, we all hope that what the team has been able to do is to get to the root of all sorts of issues and point a way forward. And that would be really beneficial because I don't think anybody in Tower Hamlets wants to see commissioners coming in. At the same time, this is an unusual step that's been taken. This isn't a kind of something that happens every day of the week. When it does happen, like the last time it happened in Tower Hamlets when PwC came in 10 years ago, the only other council that had been subject to a similar inspection was Rotherham, which for other reasons but appalling reasons. And we found out that we had some very appalling reasons going on here in Tower Hamlets as well. It's really incumbent on us, I think, to make sure that this document represents the collective views, whether they're agreeing or disagreeing, rather than just the views of the administration and the majority group. And so I couldn't support this as it stands. I'm happy to be involved in some further discussions about what it might look like before the next meeting. Thank you for that, Mark Francis. I know it's a difficult one. David, do you want to? Thank you, Chairman. Thank you for the comments. I'm asked to compile this document because my role is a unique one with the organisation in terms of the independence that comes with it. So I would say to the committee they can take some degree of comfort from that. I think some of the views about this document will necessarily be subjective and we probably all have slightly different views on it. My view is in compiling this I obviously take soundings from a range of stakeholders, I synthesise them into one document. I've been given some amendments but not many from the draft which I pulled together. My view would be that it's a measured and balanced document but I do take on board the comments that have been made and we will look to improve the document in line with those, Chairman. Thank you for the assurance. Covid-19, the final question on this, please. Thank you. Thank you, Chair. First, if I can draw context, I think it's quite unfair what Councillor Francis was saying. We're not here to defend others. I'm not defending anybody. What's your opinion? Yes, I'm getting to it. Please. I'm getting to it. So I think we need to put this committee in context to every other audit committee in the country which is decided on proportionality and previously to assume that this committee will simply drive through whatever is put forward is, one, unfair. And kind of to argue the case in relation to both the best value inspectors, with the best value inspector, one of the best value inspectors in the room as well, before, you know, their inspection report has come in, in understanding why and exactly the intricacies around that is also, I feel, unfair to bring it up within this committee as this song has been sung in every committee Councillor Francis has sat on. Including the full Council. But that aside, in relation to this paper. We're running out of time. We need to know. Yes, I'm getting to the question. Please, if you don't mind. I'm getting to the question. Yes, and I have right to express my views as well. We're not here to defend each other. No, I'm not defending anybody. As a committee, it's unfair. We'll decide later on. Yeah, so I think the other thing is the grouping of officers who've compiled this report have all pretty much been new officers who've come into the organisation and have tried to galvanise the collateral damage that was already existing within the auditing systems of this Council from sort of officers without mentioning names. So I think officers have tried their best in order to galvanise what they can from the information that was left behind. So that's the first thing. The second thing, what I wanted to pick up on is around the issues identified in this tax year, 23/24, sorry, last tax year, 23/24, and update us on the risk of the accounts in relation to that and the controls put in place. Particularly around the financial management systems and how robust are we in relation to one holding departments to account. How reactive we are, where we see fluctuations and how accountable we are from the corporate centre to the departments that may float around within this Council. I hope you got the question. David, can you please comment on those? I think if I heard right, I think the question is about the extent to which financial control is exercised by the centre, if I heard that correctly. I mean I think probably the first thing is I don't invite colleagues from finance to say what's happening at the moment, the progressions and the developments that are happening. And then I can perhaps talk a little bit about the controls that we've tested, Mr Chairman. Thank you, so I think that concludes it. Does the Committee have any other questions? Can I ask the comments of the Committee are noted? I think Ms Lorraine wants to comment on that before we finish this item. Okay, Lorraine, can I invite, yes, can I invite your comments please? So I just wanted to respond to the Councillor's question and really for me one of the most important functions of an Audit Committee is to be satisfied that there are effective systems of control in place. And it's often not the issues that are the matter of the Audit Committee, it's the actions and controls that are put in place to ensure issues arise and don't happen again or things improve. So yes, Councillor, at the beginning we did hear about issues, we heard last year about issues of unpublished accounts and late accounts. Has that been addressed? Clearly we've seen that, but then we've now got a risk of qualifications of accounts because we were very clear that there is a risk in publishing a series of unaudited draft accounts. So we need now to put controls in place, the control in place to ensure that accounts went late again. Abdul Razak and, well I know that Deloitte, but possibly EY if they've seen a timetable, will be able to demonstrate, and you've heard today, will be able to demonstrate that it is financial year 23/24. Currently, the current year's AGS is with you on time. The accounts close down process, if the team are looking a bit bleary eyed, it's because they are actually delivering that close down process this year for the Council on time, for the first time in a number of years, having already visited since October for consecutive years of accounts. So each time you revisit one, each time we get an audit, our objective is to put effective controls in place to ensure that issues identified in that audit aren't repeated in the next audit, so it's iterative. I think an accumulation of outstanding audits, and this Council now is in no different position than many others, there are a lot of councils with outstanding year's audits, and they'll all be in the same position that will be things emerge in groups. Does that mean we sit there and wait until we find out the hard way that there was failures in our internal systems of control? No, we're doing three things. One, we are reviewing all of our financial regulations, all of our procurement regulations, we've commissioned an external assurance from the wholly owned subsidiary of CIPFA, who will give assurance to you, the committee will receive that updated regulations and framework of internal controls, and an independent assurance from CIPFA that says it reflects best practice. So these are the things that are currently being done to not only improve, you can't say let's improve our controls, you have to know which ones you're going to improve. So what we've done is review all of them and look at our control framework as a whole and bring that back to you with assurance from an organisation like CIPFA that it does reflect best practice. So I hope that answers your question. Thank you for that. Now, can I ask the audit committee is recommended to note the comments on this work plan for 2024? Yes, we missed one page. Can I ask the audit committee is recommended to review and agree the Council's annual governance statement in relation to 2024? So I thought it was going to be taken away and a slightly revised version would come back to the next committee, is that not going to be the case? Okay, we can wait for that. So I would say as a chair, I would ask David if you can bring the next meeting and then we'll agree then. Sorry, chair. That was a comment, but we didn't vote on things going back and being revised and coming back. That was a comment. But if things need to go back, sorry, can I ask the clerk, do we need to vote on it as a committee if it's not unanimously agreed? Okay, we need to vote on this. Yes, of course. So we'll vote on it as it stands. Yes, as it stands. We'll vote on that. Okay, because it's complicated. I can do my best. So this isn't the first time this audit committee will see this annual governance statement. You see an annual governance statement again as part of the accounts and we are more than happy to take on board comments about specific numbers. At the end of the day, the Audit Committee don't draft the AGS and it would be wrong of me to mislead anybody and suggest that they do, but they do have to be satisfied that they've had an opportunity to ask the relevant officers to consider whether all the aspects within the SIPFA code have been included. I think they have. I don't think that an AGS for an Audit Committee should be adversarial. I think it should be something that a collective responsibility of an Audit Committee is to ensure that the annual governance statement is reflecting what it requires it to reflect. It shouldn't be a political tool. What it should be is something that people feel they've had a chance to comment on, that they are considered and brought back. That doesn't mean that we keep going and rewriting an annual audit statement until everybody's happy. Otherwise it will be years before the next one's published. So I think that it would be good if we could reach agreement maybe that subject to the comments that have been made this evening, that officers take those on board and you will see that reflected when this comes back rather than a vote on are we going to accept or reject our own annual governance statement. And I'm just trying to be fair and balanced. But that's up to members. Okay, yes, that's noted. Can you shed some light on how we proceed on this matter? Because we did receive two comments, one from (inaudible) (No audio) (No audio) We're proposing that the chair asks the committee to note the comments made by the committee in relation to the council's annual governance statement 42324 so that when it comes back, it will, one hopes, incorporate enough of the comments that everybody is happy with it and can sign off at that point. Clarification. So notes, is that within the minutes or within the annual governance statement? I would suggest that that's a very pragmatic way forward. That what we should do is the minutes should reflect, the committee should agree that they've noted the annual governance statement and comments. And when you see this come back, which it will come back to you, with the annual accounts, even the passage of time between now and the annual accounts, if that best value review is concluded by then, it will reflect what that situation is. It won't be steeped in the past. So it's really important that it's a current document. So I'm trying really hard to get us all on the same page. It is about transparency. So we will note the comments. And what I would suggest, David, is if we can give a commitment that when it does come back, that the report that's presented reflects the fact that officers have considered comments made by the audit committee in relation to the draft. Is that okay? Just to add. So I think that's a helpful way forward. I think looking at this as if it's an opportunity to feed in comments is good. Like probably if the committee itself, a session of the committee itself, isn't the best place to start that off. Or that I would say, recognize where the political power lies. But I think that this kind of document needs to reflect all views where possible. It needs to contain more balance. And I hope that when we get similar things coming through in future, we'll get balance. So I was just looking back at the annual governance statement from 2014-15, which said everything was fine. And clearly it wasn't. So thank you for your contribution. So we agree on that as discussed. Thank you. Now moving on. Item 7. Audit committee work plan. These are on pages 29 to 35. Main agenda. We have three minutes for this. Can I ask members to note the audit committee work plan? And if there's any suggestion can members wish to make. These are on pages 29 to 35. If you kindly have a look and please give us any suggestions if you wish to make. Audit committee work plan. Pages 29 to 35. From my perspective, this looks like quite a pretty full work plan. It's going to keep us busy. It's going to be involved in some long meetings. I mean, if what you're suggesting is that there might be scope for some additional things to be an area of focus, I guess, in January next year. I'm happy to take that thought away and come back at the next meeting. I will buy your comment, please. Thank you, chair. Just noting that the 18th with the proviso of the 18th in terms of the work plan, I think Farhan is going to go back and look at rejigging the 18th. So, if we could look at adjusting that, I'll be happy to be flexible as possible from my part. Lauren, if I can kindly ask, can you switch off your microphone, please? Thank you, chair. I wondered, given the reference that Julie made to the SIPFA review, whether that's something that should be specifically included on this work plan. And given what else, there's been some other comments about external reviews in the annual governance statement, but also in some of the later papers. And I wonder whether those should be included as well, because there's been a number of external reviews on different parts of the council, which haven't necessarily, we haven't necessarily had sight of that at this committee. And I don't think we need to see the full reports of all of those, but where there are judgments being made or assessments of controls, I think it'd be useful for us to have that information in some way. Julie, would you like to comment or make some suggestions on that, please? So, for me, I'd go a step further, hopefully to your delight. I think when it comes to systems of internal control, frameworks of internal control, the audit committee has more than a role in seeing that the assurance was okay, actually. That is your remit. Those controls are the reason here. So you may get a bit sick of seeing them, and the control framework, because in my view, used to operate where any changes to that control framework are reported back to an audit committee. So one should prove it, it's in place, receive assurance through audit and different areas that the controls you have in place are being adhered to, and when those controls change, that's brought to your attention as well. So in things like that, that assurance to you is a source of independent assurance that's been reviewed, yes, but it's not instead of you overseeing that framework of internal control. So absolutely, the audit committee has a key role to play. And increasingly, you will see within a lot of processes, a good example is very recently, our financial sustainability plan went through cabinet, and that talks about triggers where in the event of a financial trigger, this is a control, actually the audit committee is convened to consider certain matters. So you will see all that reflected, it won't just be the SIPFRA report, and we need to be very clear, what SIPFRA are going to do is not write a report about internal controls. They're going to review our updated internal controls, and they're going to provide assurance that yes, they meet best practice. You will see the detail of the controls. Thank you, Julia, for that. I can see your hand. Can you? Thank you, chair. So another thing I think might be important for us as a committee, an audit committee, is to look at the different upgrades, because there's a lot of money being invested in the council in terms of upgrades of various different systems and how that impacts on delivery. So again, I think we need to be quite focused on terms of reference and the role of the audit committee. I think that's a really important point about systems, and of course the key area of oversight for any new systems is, we looked at considered cyber security at the last meeting and the risk of that. So I think that impact of new systems in that control environment is very much a role for the audit committee. And perhaps consideration of effectiveness of those systems might be something for cabinet scrutiny, those type of forums here should be about the impact on our control environment of those new systems coming in. I hope I've described that. Okay. Can I now at this stage ask the audit committee to note the comments for 2020, for 2025? Yeah. Okay. Thank you. Moving on, we have item eight. Any other business? So there's no other business to discuss. So item nine, exclusion of press and public. Okay, so we're going to switch. Okay. So this item that we're about to discuss offline is a really serious issue, undoubtedly really serious issue. Nevertheless, I'm not going to speak about the issue. I'm just going to ask for details or for an explanation on the record about why this can't be discussed in public at this stage. Because this is quite serious. Okay, so we need some sort of legal, okay. I sought advice on this as to what should be in the public domain at this stage and what shouldn't. And the advice I was given was because it is currently subject to an ongoing investigation that has not concluded, that is the reason that it is in a closed part of the meeting. And nothing else. Great. Okay. So we have the legal side. I'll read that for the committee to hear. In view of the context of the remaining items on the agenda, the committee is recommended to adopt the following motion. That under the provision of section 100A of the Local Government Act 1972, as amended by the Local Government Access to Information Act 1985, the press and public be excluded from the remainder of the meeting for the consideration of the section 2 business on the ground that it contain information defined and exempt in part 1 of the schedule 12A to the Local Government Act 1972. That's the law. [BLANK_AUDIO]