The Audit Committee of Wandsworth Council met on Tuesday 17 September 2013 to review the Council's accounts for the 2012-13 financial year and its annual governance statement. The committee approved the Council's accounts, with minor adjustments, and also approved the Annual Governance Statement for 2012/13.

The Council's Accounts 2012-13

The committee received a report from Katy Elstrup of PriceWaterhouseCoopers (PwC) regarding the Council's accounts for the financial year ending 31 March 2013. Ms Elstrup confirmed that school accounts had been examined and all requested information had been received, with PwC anticipating the final sign-off by the end of the week. While minor adjustments were made to the accounts, they had no overall effect, and no other significant issues were identified.

The Director of Finance addressed misstatements in the accounts concerning the Francis Barber Pupil Referral Unit, explaining how the situation arose and assuring the committee that measures would be put in place to prevent recurrence. These measures include additional departmental checks and structural changes to enhance manager accountability for their budgets. John Johnson, Assistant Director of Children Services, further reassured members that the individuals involved and the reasons for the issue had been identified, leading to new checks being integrated into processes. Managers have been briefed, and training will be completed within the next two weeks. Councillor Maurice Heaster, the Chairman, emphasised the importance of learning from these mistakes.

Ms Elstrup noted that one public query had been received regarding the accounts, which was still outstanding. To close the accounts, all queries must be resolved, which could cause delays. However, PwC remained confident in signing off the accounts as planned, considering the outstanding issues to be non-material.

The committee resolved to:

• Receive the communication from the external auditor.
• Approve the management representations letter for signature by the Chairman.
• Approve the revised statement of the Council's accounts for the financial year ended 31 March 2013.
• Receive an update from the Children's Services Department on arrangements to avoid misstatements in the accounts and further details of the double-entry cases concerning the Francis Barber Pupil Referral Unit.

Annual Governance Statement

The committee considered the Annual Governance Statement for 2012/13, presented by the Head of Audit. Councillor Mrs. Kim Caddy expressed concern about the pace of progress, noting that actions remained outstanding from previous years, and suggested that future statements include an analysis of delays. The Head of Audit explained that the number of outstanding issues was significantly lower than in previous years, following actions taken in response to similar concerns raised in January. He also confirmed that a summary of delays could be included in future reporting.

Councillor Caddy also highlighted the importance of whistleblowing procedures and suggested liaison with the Head of HR and cross-departmental working to ensure these procedures remained prominent.

The committee discussed specific points within the report:

• Budgetary control: Councillor Mark Thomas called for tighter controls and greater manager responsibility.
• Commissioning: Councillor Thomas raised concerns about robust procurement procedures within partnerships. The Head of Audit reassured the committee that he would have opportunities to influence discussions on contract renewals by attending meetings of the Health and Well Being Board and was discussing financial management with the Clinical Commissioning Group to promote better coordination and consistent standards.
• Saint Cecilia's, Wandsworth, CE School: Members unanimously agreed that the use of public funds at this school was unjustified and unacceptable. The Head of Audit noted the Council's limited powers in controlling school expenditure and the uncertainty of legal action. However, the new Headteacher was keen to address the auditors' and Governing Body's concerns to increase transparency. Councillor Caddy expressed concern about the lack of effective controls and sanctions once money had been spent. The Head of Audit explained that the Council could withdraw delegated powers in cases of persistent non-cooperation, though this was a serious step. The Chairman suggested a timeline for action, with further consideration if Governors did not act. Councillor Mrs. Antonia Dunn referred to repeated concerns about school finances and it was agreed to write to the Governors of Saint Cecilia's to remind them of the legitimate uses of public money.
• Roehampton Church CE Primary School: Issues flagged at this school were discussed, again highlighting the need to remind Governors of their responsibilities. Councillor Mrs. Dunn requested that draft reports be sent to all relevant Governors. The Director of Finance referred to emerging themes in school finance audits and suggested emailing all school governors in the Borough to make them aware. Governors of schools with audit concerns who did not provide satisfactory responses would be contacted directly. Councillor Caddy suggested writing to Resident Management Organisations (RMOs) to inform them of relevant Audit reports. The Director of Housing raised data protection concerns regarding the use of RMO contact details. The Head of Executive & Committee Services agreed to seek clarification and communicate findings to the committee. Regarding RMOs, the Director of Housing noted that the Battersea Fields RMO was now managed by Council staff, but concerns remained about the Goulden House RMO. He acknowledged the difficulty in determining the best intervention methods given the autonomy of these organisations.
• Offence/irregularity, sanctions and redress (Unauthorised Occupancy): Councillor Mrs. Dunn expressed pleasure at the return of stock and thanked staff involved. The Head of Audit attributed these results to close working relationships with the Housing and Legal Departments.
• Data security: In relation to Appendix D of the report, the Head of Audit stated that data security needed to be added to the schedule, particularly in light of recent fines issued by the Information Commissioner.

The committee resolved to:

• Note the Council's statutory annual review of its governance arrangements, incorporating internal control.
• Approve the proposed Annual Governance Statement for 2012/13, as amended at the meeting, for signature and publication with the Council's accounts.

Audit Service AQPR

The committee received the report of the Head of Audit for their information and resolved to note the report and confirm the timetable and arrangements for monitoring and review by the Committee and its Members.

RIPA

The committee received the report of the Director of Finance for their information and resolved to note the report.

Croydon NHS Scrutiny Review

The committee received a report from the Director of Housing. Councillor Caddy, as a member of the Joint Health Overview and Scrutiny Committee, provided an update, stating that a response from the Secretary of State for Health was awaited, including recommendations to widen scrutiny powers. Members expressed serious concerns over NHS Croydon's misstatement of their accounts, noting that both internal and external audits had signed off the accounts, indicating a lack of thoroughness. Concerns were also raised about a lack of cooperation during the scrutiny process and that some individuals involved remained employed by the NHS, suggesting a lack of accountability.

The committee wished to ensure robust action was taken. Councillor Senior suggested that, in addition to letters from the Leader and Chairman of the Adult Care and Health Overview and Scrutiny Committee, the Audit Committee should also write to the Secretary of State for Health outlining their concerns. The Chairman added that a draft letter would be circulated to members for comment before despatch, and the committee would be kept informed of any responses.

The committee resolved to:

• Authorise the Chairman of the Audit Committee to write to the Secretary of State for Health expressing their serious concerns.
• Note the report.

Residents Management Organisation

The committee received a report from the Director of Housing. Councillor Thomas described the report as excellent, bringing much-needed transparency and highlighting the significant work undertaken by the Housing Department and Audit Service. The committee resolved to note the report.