The Chair welcomed everyone to the meeting.

Apologies were noted as above.

It was agreed that there were no agenda items for which voting rights could not be conferred on the Non-Constituent Members.

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Councillor Furness requested an amendment to minute 13.  With regard to the creation of 70,000 new houses by 2024, he had asked if this could be linked to the new dwellings figures set out in Local Plans published by all the Local Authorities.  D Smith commented that there was no current link between the SEP target and the Local Plans but this would be considered within the revised Strategic Economic Plan currently under development.  

Action: When the revised new SEP is published the Committee to be advised of new targets.

With regard to minute 2, R Jarvis stated that he had not seconded the proposal to appoint an independent Chair and asked that his name be removed from this.

R Jarvis commented that, with regard to the procurement of an internal audit provider it had been agreed that the terms of reference would be revised to clarify the role of the Committee in Internal Audit arrangements, and asked that this was included in the minutes.

Action: Clarify the role of the Committee in Internal Audit arrangements in the Terms of Reference.

RESOLVED:  That, subject to the amendments mentioned above, the minutes of the meeting of the SCR Audit and Standards committee held on 13^th June 2018 be agreed as a true record.

A report was submitted to consider the Authority’s Annual Governance Statement for 2018/19 which included the Governance Improvement Plan.

The Annual Governance Statement was brought to the Committee for any questions or observations before being embedded in the accounts and presented to the Mayoral Combined Authority.

Sections 1-3 of the report provided basic background including information on the Local Enterprise Partnership, the Executive Team and the statutory officers.

Section 4 summarised the governance review activity that had taken place during the year.

These included new governance arrangements for the thematic boards, a Local Growth Fund programme review, an annual performance review undertaken by the Ministry for Housing, Communities and Local Government and an Annual Governance Review.  Members noted that the outputs from the Annual Governance Review were summarised in Annex A to the report and had assisted in the preparation of the Annual Governance Statement and the Governance Improvement Plan.

Section 5 highlighted outstanding areas for development that External Audit recommended should be focused on and provided an update on outstanding recommendations from the previous Annual Governance Statement.

Section 6 was the main area of Member focus as it contained the progress made against the 2018/19 Governance Improvement Plan.

Section 7 provided a summary review in terms of risks and controls and Section 8 was a look forward to the areas of focus for strengthening governance in 2019/20.

A Marshall referred to the External Audit recommendations from 2017/18. With regard to the impairment review, the recommendation was that the Group had to have effective monitoring control over the PTE and she queried what the Group had put in place as an effective monitoring control over this.

A Marshall also queried what the Group had in place with regard to pensions assurance.

Officers gave various examples of the monitoring controls in place with regard to impairments and pensions.

The Monitoring Officer commented that the Statutory Officers Group worked with the Director General of the PTE to keep sight of all the ongoing issues.

R Adams suggested strengthening the wording in the Annual Governance Statement as to how Statutory Officers provide Group oversight and management of key issues.

With regard to Table 4 and the areas of focus for 2019/20, R Jarvis suggested that it would be helpful to include dates and responsibilities for the actions.

R Adams agreed to look at including names or groups and indicative timelines into the table.

RESOLVED:  That, subject to the additions detailed above, the Committee approve the Annual Governance Statement for 2018/19.

This item was dealt with during the Statement of Accounts item.

A report was considered which provided the Committee with an update on changes made to the Statement of Accounts since the unaudited version was presented to Members on 13^th June 2019.

M Thomas thanked S Tompkins, A Mumford and S Ahmed who had been instrumental in working to a tight schedule to pull together the draft accounts and deal with all the fieldwork questions from EY, and also to the rest of the team for their support with regard to the audit and the accounts.

He also thanked EY who, in their first year, had been very professional and thorough and also to E Walker for reviewing the draft accounts.  E Walker was due to stand down as a Statutory Officer in due course and had delegated authority to M Thomas to sign off the accounts at the MCA meeting on the 29^th July 2019.

As mentioned earlier, subject to the Committee’s agreement or otherwise, the Group accounts should be caveated with the fact that the PTE’s Audit and Risk Committee were due to meet on Tuesday 16^th July, so the accounts were subject to their endorsement of the PTE’s accounts.  M Thomas would be asking the Committee today to recommend the Group accounts to the MCA on 29^th July 2019.

There had been four adjustments in total, two on the PTE side and two on the CA side.

The adjustments to the PTE accounts (and therefore the group accounts) were:

Revaluation reserve – this acknowledged that the 2017/18 accounts contained a substantial error which was now being corrected.

Adjustment to the balance sheet - this was due to a directive from South Yorkshire Pensions Authority who had been instructed by their auditors to take the full actuarial assessment of pension liabilities for all local government bodies within South Yorkshire; this had to be done as a result of the outcome of the McCloud court case.  This would lead to an increase of approximately £750k.

With regard to SYITA Properties Ltd, which was now almost liquidated, in 2017/18 PWC had advised that it was appropriate to make an adjustment to the accounts in relation to this.

However, EY’s view was that the adjustment was premature and a further adjustment had been made to the accounts to reflect this.

The final adjustment was in relation to a Skills Bank grant.  £1.1m should have been transferred to a reserve account but was wrongly held as a receipt held in advance.  This had now been corrected.

D Spiller presented EY’s audit results report.

He drew the Committee’s attention to the risks that had been identified previously in the audit planning report which had been presented in April; particular attention had been paid to these areas.

There had been two changes to the scope of the audit:

• The approach to the testing of PFI balances had been updated to include the account as a higher inherent risk.
• The materiality assessment had been changed from £3.351m to £2.956m

EY had substantially  ...  view the full minutes text for item 11.

A report was submitted that presented an update on the status of the outstanding recommendations made by Internal Audit during 2018/19.

Members noted that the appendices to the report had been produced in a different format which was intended to be more transparent for Members.

The Committee noted the status of the implementation of the recommendations to audits of:

·         GDPR Compliance

·         Transport Capital Programme

·         Inward Investment

·         Payroll

·         AMP Technology Centre

·         Accounts Payable

Members noted that all GPC card holders would be provided with refresher training and reminded of their responsibilities, this was presently being organised.

RESOLVED:  That the update on the 2019/20 Internal Audit recommendations be noted.

The Committee considered its Work Plan for 2019/20.

C James informed the Committee that it was a draft Work Plan and included training sessions which Members had requested.  Further suggestions for additions to the Work Plan would be welcomed.

With regard to the training on scrutinising the accounts, M Thomas informed the Committee that three options had been considered.

• In-house training
• Asking EY to provide the training
• Use an external provider

Members were asked to communicate their preferences to officers.

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