Agenda and minutes

Audit and Assurance Committee - Tuesday, 7th December, 2021 10.30 am

Venue: Conference Room A/B, Cumbria House

Contact: Daniel Hamilton  Email:

No. Item



To receive any apologies for absence


Apologies were received from Mr G Cook.



To note any changes to the membership of the Committee




There were no changes to the membership of the Committee on this occasion.



Members are invited to disclose any disclosable pecuniary interest they have in any item on the agenda which comprises


1          Details of any employment, office, trade, profession or vocation carried on for            profit or gain.


2          Details of any payment or provision of any other financial benefit (other than from the authority) made or provided within the relevant period in respect of any expenses incurred by you in carrying out duties as a member, or towards your election expenses.  (This includes any payment or financial benefit from a trade union within the meaning of the Trade Union and Labour Relations (Consolidation) Act 1992.


3          Details of any contract which is made between you (or a body in which you have a beneficial interest) and the authority


(a)       Under which goods or services are to be provided or works are to be executed; and


            (b)       Which has not been fully discharged.


4          Details of any beneficial interest in land which is within the area of the authority. 


5          Details of any licence (alone or jointly with others) to occupy land in the area of the authority for a month or longer. 


6          Details of any tenancy where (to your knowledge)


            (a)       The landlord is the authority; and


            (b)       The tenant is a body in which you have a beneficial                                                         interest.


7          Details of any beneficial interest in securities of a body where


(a)       That body (to your knowledge) has a place of business or land in the    area of the authority; and



(b)       Either –


(i)      The total nominal value of the securities exceeds £25,000 or one            hundredth of the total issued share capital of that body; or


(ii)     If that share capital of that body is of more than one class, the total nominal value of the shares of any one class in which the relevant person has a beneficial interest exceeds one hundredth of the total issued share capital of that class.

In addition, you must also disclose other non-pecuniary interests set out in the Code of Conduct where these have not already been registered.




A “disclosable pecuniary interest” is an interest of a councillor or their partner (which means spouse or civil partner, a person with whom they are living as husband or wife, or a person with whom they are living as if they are civil partners).


There were no disclosures of interest made on this occasion.



To consider whether the press and public should be excluded from the meeting during consideration of any item on the agenda.


RESOLVED that,                 there were no items on the agenda which require the exclusion of press and public.



MINUTES pdf icon PDF 316 KB

To confirm as a correct record the minutes of the meeting of the Committee held on 27 September 2021 (copy enclosed).


RESOLVED that,                 the minutes of the previous meeting which took place on 27 September 2021 be agreed as an accurate and complete record. 



To consider a deep dive risk analysis presentation relating to the ‘Safeguarding of Children’ risk.



Members received a presentation regarding the Children’s Safeguarding risk.


The presentation was delivered by the Assistant Director - Children & Young People (Deputy DCS) and highlighted the following key areas relating to the risk:-


  • Overview of Safeguarding Risk
  • Covid Context
  • Staffing Resource
  • Failure to Follow Regulations, Policies and Procedures
  • Training and Supervision
  • Breakdown of Partner Relations
  • Local Government Reorganisation (LGR)
  • What the Committee can do to support?


Members asked for further comment on the attendance of children and young people at the County’s Hub Schools which were set up as part of the Covid-19 response. The Assistant Director - Children & Young People (Deputy DCS) explained that an evaluation of Hub Schools was underway to discover if there were any children who should have been offered a place but weren’t. It was AGREED that more information on this be shared with the Committee and it was requested that this be added as an item to the Scrutiny Advisory Board – Children and Young People action plan.


A discussion took place regarding emotional health and wellbeing whereby members asked officers to consider higher rates of mental health as not only reflecting a deterioration in the mental health of young people but also as reflecting a greater awareness of mental wellbeing in general and better recognition of symptoms.


The Vice-Chair asked whether there was still an acute issue relating to need for children and young people to become ‘looked after’ in West Cumbria. The Assistant Director - Children & Young People (Deputy DCS) answered that though need was still high in the west of the county the areas of Carlisle and Eden had in fact seen a greater increase in need more recently. Similarly, members heard that the demand on social workers was now as great in other areas of the county as they were in West Cumbria prior to the pandemic.


A conversation then took place regarding domestic violence and the increase in referrals across the county. The Assistant Director - Children & Young People (Deputy DCS) addressed the issue by explaining the impact of multiple lockdowns on people’s home lives and stated that working with families who had experienced domestic abuse was a key priority.


The Vice-Chair asked for more information regarding the opportunity to offer health and social care apprenticeships so as to bolster the workforce whilst creating a viable career pathway for young people. The Assistant Director - Children & Young People (Deputy DCS) agreed that encouraging young people to take health and social care courses was paramount and that officers would be engaging with pupils in schools to discuss the career opportunities on offer.


As part of a discussion regarding nutrition it was AGREED that the Assistant Director – Education and Skills provide some information about the position of schools in encouraging healthy diets for young people.


Members were given assurances regarding safeguarding policies and the significant role that Social Worker’s themselves play in shaping policy and procedures and in keeping up to date with any changes.


The Chair stressed the  ...  view the full minutes text for item 175.


2021/22 Quarter 2 – Corporate Risk Report pdf icon PDF 537 KB

To consider a report from the Director of Finance (s151 Officer).


Additional documents:


Members considered a report from the Executive Director – Corporate, Customer and Community Services which provided members with a progress update on the Corporate Risk Register for Quarter 2.


The Senior Risk Officer began by providing the context and background for the Quarter 2 /early Quarter 3 period outlining the risk landscape at that time. Members heard that the ongoing and dynamic nature of Covid-19, sustained pressure on the Health & Social Care sector and the July notification of the LGR decision were all themes which were reflected in the changes to the risk register during the period.


The Senior Risk Officer highlighted the changes noted in the report compared to the previous Quarter 1 risk report, which were as follows:-


·      That there were 13 corporate risks on the Quarter 2 Risk Register


·      9 high risks remained on the register, the same number as at Quarter 1.


·      There were 4 medium risks, compared to 3 at Quarter 1.


Members were reminded that in the previous Quarter 1 report it was outlined that one risk was due to be removed from the register and two new corporate risks added to the register during Quarter 2, these were described as follows:-

  • During Quarter 1 an overarching LGR Programme risk was developed around the delivery of the LGR benefits – this would now be removed from the Council’s risk register and be under consideration by the LGR Board in due course.
  • In Quarter 1, it was agreed to add a further risk around the impact that the LGR programme would have on the quality provision of County Council Services up until vesting day and the impact on the effective closure of the Council.  
  • Additionally, it was agreed to add a risk relating to climate change to the Quarter 2 risk register. This long-term risk had been scoped and defined around the Council’s ability to reduce its Green House Gas emissions to net zero by 2037, in line with the targets set by the Zero Carbon Cumbria Partnership (ZCCP)

Members heard that at the end of Quarter 2, two risk scores had increased, and challenges remain for those risks relating to the Resilience of the Care Sector and the Health & Social Care Demand and System Failure.In the period there had also been a deterioration in the risk relating to the Increasing Demand on Children’s Services.

The Senior Risk Officer then explained that during the summer period the risk relating to the Cumbria COVID-19 Local Outbreak Control Plan had reduced in score as lockdown restrictions were eased and vaccination levels increased.

To conclude the Senior Risk Officer explained that through Quarter 3 and Quarter 4 (the winter period) all current corporate risk would continue to be monitored, especially in the context of winter pressures within Health & Social Care and the potential disruption caused by any severe weather-related incidents.

A discussion took place regarding the resilience of the Care Sector whereby the Director of Finance commented on the multi-agency response to the Health and Social Care  ...  view the full minutes text for item 176.


Internal Audit Progress Report 31 October 2021 pdf icon PDF 591 KB

To consider a report from Group Audit Manager.



Members considered a report from the Group Audit Manager which summarised progress on audit work included within the 2021/22 audit work plan and an update of the completion of outstanding 2020/21 audit work.

Members heard that there had been 6 audits completed in respect of the 2021/22 audit plan. The Group Audit Manager highlighted to members that the report now provided more detailed commentary on each completed audit review. In addition to outlining the high and medium priority recommendations for each review, the report also included a summary of where controls were working effectively and commentary on when recommendations are expected to be implemented. The Group Audit Manager reminded members that it remains management’s role to monitor the implementation of our recommendations.


The Group Audit Manager stated that there had been four completed risk-based assurance audits including:


  • 3 ‘Reasonable assurance’ – Operator’s Licence, Renewable waste contract – Governance arrangements and Highways Conditions Inspections


  • 1 ‘Partial assurance’ – High Needs Block (EHCP budget management). 


Members heard that there were two audit reviews that had not been expected to be at draft report stage or finalised in 2020/21 and had been rolled forward into the 2021/22 audit plan. However, the Audit team had managed to progress them and included them in the Head of Internal Audit Opinion in 2020/21. They related to follow up reviews of services for Children with Additional Needs in both North and South Cumbria, these resulted in a Reasonable assurance judgement for North Cumbria and a Partial assurance judgment for South Cumbria.

In addition to the six reviews described, the Group Audit Manager explained that the teams had also finalised two further audit reviews in the period. These were expected to be finalised in 2020/21 so were not included in the 2021/22 audit plan. They related to the significant contracts review on the external fostering framework (‘Reasonable’) and Safeguarding Adults (‘Partial’). These had been included in the previous Head of Internal Audit Opinion.

Members heard that significantly more audit work had been undertaken over the last year relating to certifying grant claims. This was due to the increase in various funding streams from the Government to support the Council’s response to the Coronavirus pandemic.


The Group Audit Manager highlighted some changes to the Audit Plan explaining that some previously unallocated time had been allocated to additional grant certification work and potential internal audit work on LGR. There had also been 1 review relating to ‘Financial Sustainability’ that had been removed from the 2021/22 audit plan.


The Group Audit Manager outlined the overall position on plan progress for 2021/22, explaining that the re-assessed plan included 56 reviews with 15 (27%) completed to at least draft stage with a further 18 (32%) having been started or at the fieldwork stage.

At the 31 October 2021 five assurance reviews had been completed and a further three draft reports had been issued giving a total of eight assurance reviews to be considered for the 2021/22 Head of Internal Audit Opinion. The  ...  view the full minutes text for item 177.


Draft Annual Treasury Management Strategy Statement 2022/2023 pdf icon PDF 297 KB

To consider a report from the Director of Finance (s151 Officer).

Additional documents:


Members considered a report from the Director of Finance (s151 Officer) which presented the Draft Annual Treasury Management Strategy Statement 2022/23. The Senior Manager - Pensions and Financial Services introduced the report by explaining that as in previous years the report being presented to Committee would be updated before being presented to Full Council in February 2022. Members heard that the strategy statement would be updated to reflect any changes in the economic outlook including forecast Bank Rate and borrowing rates, the latest investment performance as well as any changes to external loans; and finally, the finalised statement would include the Prudential Indicators for 2021/22 – 2026/27.


The Senior Manager - Pensions and Financial Services explained that in terms of the fundamental content of the report, there were no material changes from the2021/22 Strategy presented to Council in February 2021. However, members heard that significant consideration had gone into the process of preparing for Local Government Reform (LGR) and that a key element of this work had been in developing budgets and forecasts for the proposed new authorities.


The Senior Manager - Pensions and Financial Services explained that this was a significant piece of work which would take time and that the Finance team were not yet in a position to set out budgets and forecasts for post 1 April 2023. It was highlighted that the reporting requirements state that forecasts beyond the vesting date of 1 April 2023 must be included and so as to comply with the reporting requirements the final version of the report would include forecasts that were based upon if the Council were to continue to exist in its current form.


Members were given the assurance that considerable work was being undertaken across the Cumbrian Councils to consider the impact of LGR on Treasury Management functions, as well as on associated strategies such as the Capital Programme and Prudential Indicators.


Following this, members heard that recent consultations by the Chartered Institute of Public Finance and Accountancy (CIPFA) had taken place on revisions to its Treasury Management and Prudential Codes. The primary aim of the proposed revisions was to strengthen provision within the Codes in relation to commercial investment.


The Council was still awaiting the outcome of the consultations but indications were that, once finalised, they would be subject to a “soft implementation” with full implementation expected as part of the 2023/24 Strategy. Work was being undertaken to ensure alignment with the proposed revisions and this would be reflected in the final version of the strategy to be presented to Council in February 2022.


On the topic of the forecast for Bank Rate and borrowing rates until March 2024, members heard that expectations were that rates were likely to increase over that timeframe. On the subject of borrowing, the Senior Manager - Pensions and Financial explained that in 2021 so far no new external borrowing had been undertaken, and none was expected for the rest of the year unless a decision was made  ...  view the full minutes text for item 178.


Future Procurement of External Auditors pdf icon PDF 385 KB

To consider a report from the Director of Finance (s151 Officer).


Members considered a report from the Director of Finance (s151 Officer) which asked the Committee to consider the three options available to the Council under the Local Audit and Accountability Act 2014 (the Act) in relation to the future procurement of External Auditors before making a recommendation to Full Council.


The options were as follows: -


  • Option 1 – Make a standalone appointment
  • Option 2 - Set up a Joint Auditor Panel / local joint procurement arrangement
  • Option 3 - Opt-in to a sector led body


The Senior Manager – Accountancy (Deputy s151 Officer) stated the advantages and disadvantages of each approach including the recommended approach which was Option 3. This would be to join a Sector Led Body (SLB) specified by Central Government to act as the Appointing Person on behalf of the Council. The SLB would have the ability to negotiate contracts with the audit firms nationally, maximising the opportunities for the most economic and efficient approach to the procurement of external audit on behalf of the whole sector. The PSAA would been appointed as the SLB. Members were reminded that the Council’s current External Audit provider was appointed under the PSAA procurement contract.


Following a discussion regarding the alternative options available the Group Audit Manager explained that if the Council was to choose to procure independently (Option 1) there would be no guarantee that Auditors would bid for the contract. Similarly, in relation to Option 2 the Director of Finance (s151 Officer) explained that there was no guarantee that the Council would be able to find partners with which to form a local joint procurement arrangement primarily because the arrangements would likely come to an end on the LGR vesting day.


RESOLVED that,                 members recommend that Full Council approve Option 3 i.e. to opt-in to the Sector Led Body national scheme (led by the PSAA) for local auditor appointments.





Auditors Annual Report pdf icon PDF 12 MB

(to follow)


Members considered the Auditor’s Annual Report on Cumbria County Council presented by the Senior Audit Manager and Engagement Lead from Grant Thornton.


The Engagement Lead – Grant Thornton introduced the report by stating that there were no significant weaknesses found and that the recommendations provided by the External Auditor were for the sake of improvement and had been considered in the context of Local Government Reform (LGR), something that would be considered even more in future reports.


The Senior Audit Manager – Grant Thornton highlighted some key areas of the report beginning with the Council’s financial sustainability. The headline message for this area was that the External Auditor was satisfied that the Council had strong arrangements in place to support its financial sustainability. Members heard that there were still significant challenges with regard to the delivery of savings but that the findings reflected the Auditors satisfaction with the robust financial planning arrangements as well as the appropriate levels of oversight from Council, Cabinet and the Audit and Assurance Committee.


Further detail was provided regarding the delivery of savings whereby members heard that in the context of the significant amount of savings that had already been delivered since 2011/12 (£273 million) there was a further £34 million which would need to be found over the duration of the next Medium Term Financial Plan (MTFP). The Senior Audit Manager – Grant Thornton explained that the improvement recommendation regarding the MTFP was that the Council introduce a formal mid-year review of the MTFP assumptions and that the findings of this report be shared with members.


The Senior Audit Manager – Grant Thornton continued to take members through the report and highlighted the scope for strengthening the register of interests process for the Council by reinforcing the annual request for members to renew or update their declared interests by recording the date of all updates on the website.


Members heard that a further improvement recommendation related to the introduction of a streamlined performance measuring tool that would bring together performance, finance and risk in one integrated format.


The Director of Finance (s151 Officer) welcomed the report and stated that the recommendations had been taken on board and the management response was to continue to improve upon the methods of financial reporting.


The Engagement Lead – Grant Thornton informed members that a newly introduced requirement meant there was now the expectation that the Auditor’s Annual Report would need to be agreed by Full Council and asked that officers factor this into their arrangements.


The Chair expressed her thanks to the External Auditors and the Financial teams within the County Council for their quick responses to queries and their work on completing the audit. The Chair stated that the new format of the Annual Report brought added value by providing much more context. She highlighted in particular the valuable independent conclusions that the auditors had drawn from an analysis of events over time and the fact that the recommendations were written in a way that made  ...  view the full minutes text for item 180a



To note the Forward Plan for the Audit and Assurance Committee and agree any additional items (copy enclosed).


There were no changes proposed to the Forward Plan on this occasion.



The next meeting will be held on 24 March 2022 at Conference Room A/B, Cumbria House.



The next meeting of the Audit and Assurance Committee is due to take place on 24 March 2022 in Conference Room A/B, Cumbria House.