Here is a summary of the scheduled discussions for the Audit Committee meeting.

The Audit Committee of the County Durham Council was scheduled to meet to discuss several reports and updates, including health and safety, audit strategies, financial management, treasury management, and internal audit activities. The committee was also expected to review the council's compliance with the Chartered Institute of Public Finance and Accountancy (CIPFA) Financial Management Code.

Here are the key topics that were listed for discussion:

Health, Safety and Wellbeing Performance

The committee was scheduled to receive an update on the council's Health, Safety and Wellbeing (HSW) performance for the fourth quarter of 2024/25. According to the Quarter Four 2024-25 Health Safety and Wellbeing Performance Report, the report included data on accidents, incidents, near misses, fire-related incidents, and audits and inspections of council premises.

The report noted that there had been 550 accidents, incidents and near misses, which was an increase of 25% on the previous year. There had been five specified injuries reportable under the Reporting of Injuries, Diseases and Dangerous Occurrences Regulations (RIDDOR) and ten incidents causing over seven-day absences, mainly due to slips, trips and falls.

The report also highlighted an increase in audit and inspection activity by the County Durham and Darlington Fire and Rescue Service (CDDFRS), with 15 visits to schools. The report noted that there were some issues raised regarding fire risk assessments and the interpretation of competence in undertaking them.

External Audit Strategy

The Audit Committee was scheduled to discuss the Audit Strategy Memorandum for both the Durham County Council and the Durham County Council Pension Fund.

Durham County Council

The Audit Strategy Memorandum Durham County Council from Forvis Mazars, the external auditor, outlined the planned audit approach for the year ending 31 March 2025. The approach was risk-based, focusing on areas with a higher risk of material misstatement. The memorandum identified significant risks, including:

• Management override of controls
• Revenue recognition
• Valuation of property, land and buildings
• Valuation of net defined benefit liability

The audit team also intended to follow up on significant deficiencies in internal control that were identified during the prior period audit.

Durham County Council Pension Fund

The Audit Strategy Memorandum Durham County Council Pension Fund outlined the planned audit approach for the Durham County Council Pension Fund for the year ending 31 March 2025. As with the main council audit, the approach was risk-based. The report identified the following significant risks:

• Management override of controls
• Valuation of investments within level 3 of the fair value hierarchy

The auditors also intended to follow up on significant deficiencies in internal control that were identified during the prior period audit, including differences in holding values and market values for level 3 investments.

Compliance with CIPFA Financial Management Code

The committee was scheduled to receive an update on the council's compliance with the CIPFA Financial Management Code¹ (FM Code). The Compliance with CIPFA Financial Management Code and Update Report included a self-assessment of the council's financial management arrangements and an update on the implementation of recommendations from a CIPFA Finance Peer Review conducted in December 2023. The self-assessment concluded that the council's financial management arrangements complied with the FM Code, but identified areas for improvement, including:

• Reserves review
• Finance system and service offer
• Member training
• Capital business cases
• Joined up reporting

Treasury Management Outturn Report

The Audit Committee was scheduled to discuss the Treasury Management Outturn Report 2024/2025, which provided an overview of the council's treasury management activities for the year ended 31 March 2025. The report included details of the council's borrowing activity, investment activity, and performance against key treasury management and prudential indicators.

As at 31 March 2025, the council held £434.770 million of external borrowing and £74.144 million in cash investments. The average rate of interest being paid on external loans was 3.31%, and the average rate of interest earned on investments was 4.44%.

The report also provided an update on the implementation of International Financial Reporting Standard (IFRS) 16 (Leases) and changes to the council's Minimum Revenue Provision (MRP) policy.

Internal Audit Progress Update Report

The Audit Committee was scheduled to receive an Internal Audit Progress Update Report for the period ended 31 March 2025. The report provided an overview of performance against the Internal Audit Plan 2024/25, including the status of individual audits, the number of high and medium priority actions implemented, and performance against key performance indicators.

As at 31 March 2025, approximately 84% of the individual audits in the revised plan had been delivered. The service had delivered 2,561 productive days, representing 90% of the total estimated planned days for the year.

Annual Review of the Internal Audit Service

The committee was scheduled to discuss the Annual Review of the Internal Audit Service 2024-2025, which assessed the effectiveness of the internal audit service. The review considered the structure and resourcing level of the audit team, conformance with the Public Sector Internal Audit Standards (PSIAS), and the overall performance of the service.

The review found that the structure and resourcing level of the audit team were satisfactory, and that the service was conforming with the requirements of the PSIAS.

Annual Internal Audit Opinion and Report

The committee was scheduled to receive the Annual Internal Audit Opinion and Report 2024-2025, which provided an overall assurance opinion on the adequacy and effectiveness of the council's governance, risk management, and internal control environment.

Based on the work undertaken, a moderate overall assurance opinion was provided, indicating that there was a sound system of control in place, but some weaknesses and evidence of non-compliance with controls or ineffective controls existed.

Protecting the Public Purse - Annual Report

The Audit Committee was scheduled to discuss the Protecting the Public Purse 2024-2025 Report, which informed members of the work carried out by the Corporate Fraud Team during the period 1 April 2024 to 31 March 2025.

It was estimated that the total value of fraud identified and prevented in 2024/25 by the Corporate Fraud Team was approximately £1,560,557.

Internal Audit Strategy, Charter and Plan

The Audit Committee was scheduled to review and approve the Internal Audit Strategy Charter and Plan 2025-26, which included the Internal Audit Strategy 2025-2029, the Internal Audit Charter, and the Annual Internal Audit Plan for the period 1 April 2025 to 31 March 2026.

The Internal Audit Strategy 2025-2029 and the Internal Audit Charter had been aligned to the new Global Internal Auditing Standards (GIAS) in the UK Public Sector, and the CIPFA's Code of Practice for the Governance of Internal Audit in UK Local Government, which came into effect on 1 April 2025.