Audit and Governance Committee

At the Annual Council Meeting 22 May 2025 the name of Audit Committee was changed to Audit and Governance Committee.

The Terms of Reference did not change. The Committee shall comprise of 8 councillors and up to three non-voting advisory Independent Members. 

 

Terms of Reference   1.0  Governance 1.1  The Audit and Governance Committee is a non-executive body established under section 101 of the Local Government Act 1972. With the exception of the powers reserved to the full Council by law or the constitution, the Audit and Governance Committee has been given delegated powers with respect to internal controls, financial management and corporate governance. 1.2  The Audit and Governance Committee’s membership is a mix of Councillors (not lead officers) and independent members (including the Chair). Independent members are not entitled to vote on any matter.

2.0  Statement of purpose 2.1  The Audit and Governance Committee is a key component of Newham’s corporate governance arrangements. It provides an independent and high-level focus on the audit, assurance and reporting arrangements that underpin good governance and financial standards. 2.2  The purpose of the Audit and Governance Committee is to provide independent assurance to Members of the adequacy of the risk management framework and the internal control environment. It provides an independent review of Newham’s governance, risk management and control frameworks and oversees the financial reporting and annual governance process. It oversees internal audit and external audit, helping to ensure efficient and effective assurance arrangements are in place.

3.0  Governance, risk and control   The Audit and Governance Committee is responsible for: 3.1  Reviewing the Council’s corporate governance arrangements (including the ethical framework and local code of corporate governance) against the good governance framework. 3.2  Reviewing the Annual Governance Statement (AGS), prior to its approval, and considering whether it properly reflects the risk environment and supporting assurances (taking into account Internal Audit’s opinion on the overall adequacy and effectiveness of the Council’s framework of governance, risk management and control). 3.3  Reviewing the Council’s arrangements to secure value for money and reviewing assurances and assessments on the effectiveness of these arrangements. 3.4  Monitoring the effective development and operation of risk management in the council by: ·  Reviewing the risk profile of the organisation ·  Keeping up to date with the significant areas of strategic, major operational and project risks ·  Seeking assurance that these risks are managed effectively and owned appropriately ·  Monitoring the progress made in addressing risk-related issues reported to the Committee. 3.5  Reviewing reports on the effectiveness of internal controls and monitoring the implementation of agreed actions. 3.6  Reviewing the assessment of fraud risks and the potential harm to the Council from fraud and corruption. 3.7  Monitoring the counter-fraud strategy, actions and resources. 3.8  Approving the Council’s policy to facilitate confidential reporting by employees of suspected fraud, corruption or other wrongdoing (‘whistleblowing’), and the Council’s anti-fraud and corruption policy, and money laundering policy. 3.9  Reviewing the annual treasury management strategy. 3.10  Reviewing the annual and mid-year treasury management report. 3.11  Approving the Council’s policy on the Regulation of Investigatory Powers Act 2000 (RIPA) and reviewing the use of its RIPA powers. 3.12  Reviewing the Council’s handling of any reports from the Local Government Ombudsman. 3.13  Reviewing any issue referred to it by the Chief Executive, or corporate director, or any Council body.

4.0  Internal Audit The Audit and Governance Committee is responsible for: 4.1  Approving the internal audit charter. 4.2  Approving the risk-based internal audit plan, including internal audit’s resource requirements, the approach to using other sources of assurance and any work required to place reliance on those other sources. 4.3  Making appropriate enquiries of both management and the Head of Internal Audit to determine if there are any inappropriate scope or resource limitations. 4.4  Reviewing any impairments to the independence or objectivity arising from additional roles or responsibilities, outside of internal auditing, by the Head of Internal Audit. 4.5  Reviewing reports from the Head of Internal Audit on internal audit’s performance during the year, including the performance of external providers of internal audit services. These will include: ·  Updates on the work of internal audit including key findings, issues of concern and progress against recommendations made as a result of internal audit work. ·  Regular reports on the results of the Quality Assurance and Improvement Programme (QAIP). ·  Reports on instances where the internal audit function does not confirm to the Public Sector Internal Audit Standards (PSIAS) and consider whether the non-compliance is significant enough that it must be included in the annual governance statement. 4.6  Contributing to the QAIP and in particular, to the External Quality Assessment (EQA) of internal audit that takes place at least once every five years. 4.7  Reviewing summaries of specific internal audit reports as requested. 4.8  Reviewing reports outlining the action taken where the Head of Internal Audit has concluded that management has accepted a level of risk that may be unacceptable to the authority or there are concerns about progress with the implementation of agreed actions. 4.9  Providing free and unfettered access to the Audit and Governance Committee Chair for the Head of Internal Audit, including the opportunity for a private meeting with the Committee.

5.0  External Audit The Audit and Governance Committee is responsible for: 5.1  Supporting the independence of external audit through consideration of the external auditor’s annual assessment of its independence and reviewing any issues raised by the Public Sector Audit Appointments (PSAA) or the authority’s auditor panel as appropriate. 5.2  Reviewing the external auditor’s annual letter, relevant reports and the report to those charged with governance. 5.3  Reviewing specific reports as agreed with the external auditor. 5.4  Commenting on the planned and actual scope and depth of external audit work and ensuring that it gives value for money. 5.5  Providing free and unfettered access to the Audit and Governance Committee Chair for the external auditors, including the opportunity for a private meeting with the Committee.

6.0  Financial Reporting (including Pension Fund) The Audit and Governance Committee is responsible for: 6.1  Approving the annual statements of accounts; specifically considering whether appropriate accounting policies have been followed and whether there are any concerns arising from the financial statements or from the audit that need to be brought to the attention of the Council. 6.2  Reviewing the external auditor’s report to those charged with governance on issues arising from the audit of the accounts.

7.0  Accountability The Audit and Governance Committee is responsible for: 7.1  Meeting on a regular basis to ensure sufficient time and coverage is given to each area for which it is responsible. 7.2  Ensuring that members have sufficient skills and experiences and that they receive relevant training to ensure that they are able to review and challenge each area for which it is responsible. 7.3  Commissioning work from internal or external audit, or other external subject matter experts as appropriate. 7.4  Reporting the Committee’s findings, conclusions and recommendations concerning the adequacy and effectiveness of the governance, risk arrangements and internal controls’ frameworks, financial reporting arrangements and internal and external audit functions, to those charged with governance. 7.5  At least annually, reviewing the Committee’s performance in relation to the terms of reference and the effectiveness of the Committee in meeting its purpose and reporting this to full Council. 7.6  At least annually, publishing a report on the work of the Committee.