Agenda and minutes

Audit Board - Wednesday 26 January 2022 7.00 pm

Venue: Council Chamber - Civic Centre. View directions

Note No. Item


Apologies for Absence.


 The Chairman welcomed Board Members to the meeting, noted the presence of the Chief Officer and Director of Corporate Services, the Head of Finance & Section 151 Officer, the Acting Internal Audit Manager, the Lead Auditor and the remote presence of the Head of Legal Services & Monitoring Officer via the Teams facility. Mr Paul Cuttle from the Council’s External Auditors Grant Thornton UK was also in attendance to present his reports.


The Chairman confirmed that the Member training session from the Head of Legal Services would be taken as the first substantive agenda item, following any declarations of interest.


An apology for absence was received from Councillor Butler-Ruhle due to work commitments out of Borough.


Declarations of Interest.

To receive declarations of interest from Members including the terms(s) of the Grant of Dispensation (if any) by the Audit Board or Managing Director.


There were no declarations of interest.


Member Training - Basics of Local Authority Governance

To receive a PowerPoint presentation from the Council’s Head of Legal Services and Monitoring Officer.


Members received a remote PowerPoint presentation from the Head of Legal Services & Monitoring Officer Mrs Marie Kelly-Stone via the Teams streaming facility. Members were also provided with hard copies of the training material for their retention and ready reference.


The principal areas covered in the training module included:


·       The structure of local government

·       Powers and duties Constitution (Section 9P LGA 2000)

·       Statutory Officers

·       Civil liability

·       Overview & Scrutiny

·       Governance

·       Split between GAC and Cabinet functions

·       Committees & Sub-Committees

·       Audit Board functions

·       Governance – ancillary

·       Delegation of functions

·       Recording decisions/Reasons behind a decision/Good decision making

·       Invalidating decisions

·       Acting unfairly

·       Bias and predetermination

·       Predisposition and predetermination

·       Consultation – Case law principles


In the absence of any specific questions from Members the Chairman thanked Mrs Kelly-Stone for her detailed and comprehensive presentation, and wished her a continued and speedy recovery from her ongoing health issues, which had prevented her attendance in person.



Confirmation of the Minutes of the meeting held on 22 September 2021 pdf icon PDF 236 KB




1.    That the Minutes of the Board meeting held on 22 September 2021 be confirmed as accurate.


Urgent Items

The Chairman will announce his decision as to whether there are any urgent items and their position on the agenda.


The Chairman confirmed that there were no urgent items for the Board to consider.


References from Other Committees (IF ANY)


There were no references from other Committees for the Board to consider.


Reports from the External Auditor pdf icon PDF 190 KB

Additional documents:


The covering report from the Head of Finance submitted two documents for the Board to consider and note from the Council’s External Auditors (Grant Thornton UK):


(i)              Audit Findings Report 2020/21 (Appendix A to the report);

(ii)             Auditor’s Annual Report on Dartford Council 2020/21 (Appendix B)


Mr Paul Cuttle (Director, Grant Thornton) advised Members that Appendix A represented the final edition of the auditor’s 2020/21 Audit Findings report of the Council’s accounts, previously presented to the Board as a draft document in September 2021 [Min. No. 22 refers], following completion of outstanding work. The final document contained no significant changes and was submitted for Members’ information.


The Auditor’s Annual Report on Dartford Council for the financial year ended 31 March 2021 [Appendix B to the covering report], included commentary on the Council’s value for money (VFM) arrangements. Members were advised that following changes to the National Audit Office (NAO) Code of Audit Practice (‘the Code’), Auditors were no longer required to give a binary qualified/unqualified [yes/no] VFM conclusion for local authority accounts. Instead, Auditors now reported in more detail on the Council’s overall arrangements, as well as giving key recommendations on any significant areas of weakness identified in the annual audit process.


Mr Cuttle advised the Board that under the new NAO code arrangements Auditors assessed local authority financial performance output across the three key criteria of economy, efficiency and effectiveness in the use of its resources. The performance of Dartford Council in the period under review had been strong and his positive annual report noted that no statutory or key recommendations were required and that the Council had appropriate arrangements in place to meet all three key criteria. The Council had also continued to demonstrate strong financial stability during the 2020/21 financial year, without the need to call on its financial reserves. Good partnership working practices had also enabled the Council to weather the impact of the Pandemic, with little impact on the continued delivery of services.


Members were referred to page 13 of Appendix B [agenda p.49] which detailed some improvements recommended by the Auditor. Those concerning the Council’s current approach to ‘risk’ had been accepted and reported on later in the agenda [Min. No. 36 Risk Management Strategy refers]. Recommendation Two – Procurement Strategy had also been accepted, with a new Council strategy incorporating a SMART (specific, measurable, achievable, realistic and timely) action plan targeted for completion by August 2022. Other minor recommendations regarding ‘reporting’ and ‘benchmarking’ against other Kent councils were set out on page 14 of the report [agenda p.50].


The Chairman thanked the Auditor for a very positive report on the Council’s strong financial performance in the period under review.


In response to three specific questions from the Cabinet Portfolio Holder for Finance (attending as a Board Member), the Auditor and the Head of Finance confirmed the following points for Members:


·       All Government COVID-19 Discretionary Business Grants awarded to the Council were expected to be spent in the current year via the still open  ...  view the full minutes text for item 32.


Appointment of External Auditor from the 2023-24 Financial Year Onwards pdf icon PDF 142 KB


The report from the Head of Finance set out proposals for the Council to appoint an external auditor for the 2023/24 financial year onwards, following the conclusion of the current contract with Grant Thornton UK, which was due to formally end on 31 March 2023.


The report asked the Board to recommend to the General Assembly of the Council for approval on 28 February 2022, that the Council accept the Public Sector Audit Appointment’s (PSAA) invitation to opt into the sector-led option for the appointment of external auditors to principal local government and police bodies, for the five financial years from 1 April 2023 for the specific reasons set out in para 3.9 of the report [agenda p.58/59 refers].


The Board Chairman and the Chief Officer both endorsed the recommendation from the Head of Finance.




1.     That Members recommend that the General Assembly of the Council [at its meeting on 28 February 2022], accept the invitation of the Public Sector Audit Appointments (PSAA), to opt into the sector-led option for the appointment of external auditors to principal local government and police bodies for the five financial years from 1 April 2023.



Role and Effectiveness of the Audit Board and Member Training Needs - Self-Assessment pdf icon PDF 210 KB

Additional documents:


The report from the Head of Finance enclosed a draft Self-assessment of Good Practice questionnaire (SAQ) attached at Appendix A to the report, for Members’ consideration and agreement, with a view to Officers developing an action plan for the remainder of 2022 to be presented to the next meeting of the Board in April.


The SAQ had been based on CIPFA’s ‘Audit Committees: Practical Guidance for Local Authorities and Police 2018 Edition’ document, and represented best practice for audit committees in local government throughout the UK. The guidance recommended a regime of regular self-assessment of audit committees against an agreed template of objectives.


As a first step in that process, Board Members had received a knowledge and skills questionnaire for completion from the outgoing Internal Audit Manager in November 2021. The responses received had highlighted some gaps in Member knowledge in the areas of governance, internal audit, financial management & accounting, and knowledge of the Council as an organisation. The results of that initial questionnaire exercise had been fed into the SAQ document [Appendix A to the report] for Members’ consideration that evening. The report also set-out a proposed series of bite-sized training modules to address the perceived gaps in Member knowledge listed above.


Members had received an initial training module that evening on local authority governance structures and decision making [Min. No. 28 refers]. Further training modules were proposed prior to the Board’s meetings in April, July and October 2022 as detailed in para 3.6 of the report [agenda p.64 refers]. Other matters raised in the self-assessment exercise in November 2021 had been resolved by Officers in the interim, and the results recorded in Appendix A to the report or addressed elsewhere in the agenda papers e.g. ‘Independent Member(s)’- SAQ 13 [Min. No. 35 refers].


The Chairman thanked the Head of Finance for his report and saw the advantages of developing a synergy with Members of Sevenoaks Council over the appointment of an Independent Member(s) to their respective Audit Board and Audit Committee bodies, given Dartford’s joint Audit Partnership arrangements with Sevenoaks Council.


The Cabinet Portfolio Holder for Finance [attending as a Board Member] endorsed the SAQ recommendation that he adopt a revised ‘Observer’ role on the Audit Board going forward [to be confirmed at Annual Council in May 2022], similar to the ‘Observer’ role he filled on the Council’s Treasury Management Panel (TMP). He also welcomed the proposal for the appointment of Independent Member(s) to the Board going forward, which would mirror the successful appointment of Independent Members to the Council’s Deed, Trust & Obligations Committee (DTOC) which he chaired.


The Head of Finance added the following additional commentary regarding the answers submitted in the SAQ document at Appendix A for Members:


·       Q3 – Audit Board Terms of Reference (ToRs): it had been agreed with the Head of Legal Services that a revision of the existing ToRs was required to improve on the current ‘Partial’ assessment answer;

·       Q6 – The Board did not at present formally report to Council, and  ...  view the full minutes text for item 34.


Audit Board - Independent Member(s) pdf icon PDF 281 KB


The report from the Head of Finance asked the Board to consider the appointment of one or two Independent Members to the body, and if the Board decided against the recommendation, to review its decision in January 2023.


The report set out the relevant CIPFA guidance for the appointment of Independent Members at para 3.1 to the report, together with the recommendations of the independent Redmond Review at para 3.2. The requisite skills and profile for such appointees were detailed in para 3.5 of the report. The proposed appointments would be for a period of 4 (four) years in a non-voting consultative capacity, aimed at improving the overall effectiveness of Board proceedings.


The Chairman and Members approved the proposal to appoint Independent Members to the Audit Board, and asked that the Head of Finance take matters forward in consultation with the Council’s Monitoring Officer. Members saw advantages in sharing that process with Sevenoaks Council, including the possibility of joint appointments, given the existing joint Audit Partnership arrangements between the Councils.


The Head of Finance advised Members that the first step was to finalise the role description, skills, competencies and person specification for Independent Members. Following completion of that process, the question of joint appointments with Sevenoaks Council could be considered at the next stage. 




1.     That Members approve a recruitment exercise (undertaken by public advertisement), with interviews of applicants led by a politically representative panel of Councillors, aided by senior finance officers, subject to the agreement of the Chairman of the Board;

2.     That the finalisation of the role description, skills, competencies and person specifications of Independent Members be delegated to the Head of Finance, in consultation with interview panel members;

3.     That the appointments of successful candidates be recommended by the Board to the General Assembly of the Council for approval, for a term of 4 (four) years in a non-voting advisory capacity.



Risk Management Strategy pdf icon PDF 111 KB

Additional documents:


The report from the Chief Officer and Director of Corporate Services presented a new Risk Management Strategy [attached as Appendix A to the report], for the Board’s endorsement and approval. Appendix B to the report comprised Risk Management Guidance for Members to note.


The report informed Members that the Council’s Risk Management Strategy (RMS) was last reviewed in 2015. Appendix A to the report represented a thorough ‘route and branch’ review of the former procedures, and set out in detail, how the Council would approach risk management going forward and the practices it will adopt to achieve its strategic and operational objectives, to make risk management appraisal integral to decision making in all areas of the Council’s operations.


The Chief Officer advised Members that the revised RMS [Appendix A to the report], picked-up on the relevant recommendations made in the last report from the Council’s External Auditors Grant Thornton UK [Min. no. 32 refers], and that Appendix B contained an expanded 5x5 (formally 3x3) matrix scoring grid, to better measure risk [agenda p.88 refers].


Grant Thornton had also recommended that the new Strategic Risk Register be reviewed more frequently, and a 6 month review regime was proposed going forward. It had also been noted that the 2015 Risk Register had contained far too many identified risks, and it was proposed to delete those risks that fell outside the ability of the Council to control, improve or influence.


The Chairman thanked the Chief Officer for her report and Appendices and re-iterated a previous request, that the new enlarged risk matrix include directional arrows, to indicate whether the risk had increased or decreased in each case since the previous assessment.




1.     That Members endorse the Risk Management Strategy submitted at Appendix A to the report for submission to Cabinet for approval;

2.     That the Risk Management Guidance attached as Appendix B to the report be noted;

3.     That directional arrows be added to the matrix scoring grid to indicate whether risk had increased or decreased [Appendix B report p.3 refers].



Internal Audit Update Report (January 2022) pdf icon PDF 115 KB

Additional documents:


The report from the Acting Audit Manager provided Members with an update of Internal Audit outcomes and activity since the last report to the Board in September 2021.


Members were advised that the standard update report detailed the work covered on 5 audits up to 20 December 2021 as detailed in the table on p.3 of Appendix A with the majority of audit reports achieving a ‘Reasonable’ level of assurance. Follow-up work was detailed in Appendix C with two deferred audit actions now closed.


In other matters, a new Internal Audit Manager had been appointed and was due to take up their duties on 21 February 2022. The Internal Audit Plan had been reviewed with two audits, Service Planning and Organisational Culture proposed for deferral, to allow time for new measures to those services to take effect prior to formal assessment.


With regard to the proposed deferment of the two audits, the Cabinet Portfolio Holder for Finance sought confirmation that the Council’s Internal Audit function had not been compromised as a result of the Pandemic, when some IA team members had been re-allocated to duties in the Community Hub, to help combat the effects of COVID-19 for Dartford residents.


The Head of Finance advised the Board that this was not the case. The annual internal audit plan was not a statutory document, but a risk-based plan subject to in-year revision by the Internal Audit Manager, as circumstances dictated.




1.     That Members note the report and the updates set out in Appendix A to the report.

2.     That Members approve the deferral of the Service Planning and Organisational Culture audits to the 2022/23 Internal Audit Plan as set out in Appendix A to the report for the reasons submitted.


Selective Invoice Checks pdf icon PDF 227 KB


Prior to Members considering the report in detail, the Chairman raised a point of policy.


He had noted [in relation to para 5.1 of the report] that Internal Audit had previously reported to the Board in April 2018 their findings over the Council’s informal billing arrangements with the contractor G A Evans Aerials Ltd. Internal Audit had subsequently advised the Council’s [then] Housing Maintenance Manager to agree a ‘Schedule of Rates’ agreement with the contractor in question, but this had not been actioned as the latest spot check had revealed.


Non-compliance by management challenged the authority and purpose of the role of Internal Audit (IA), and the Chairman proposed that individual service managers who did not institute IA recommendations in the future, be held to account and asked to appear before the Board in person to explain their (in) actions to Members.


The Acting Internal Audit Manager acknowledged the Chairman’s concern and assured Members that IA follow-up practices would now include recommendations made as a result of the selective invoice checks exercise, to ensure appropriate action was subsequently taken by the relevant service managers. In the case under review, the Council’s Building Services Surveyor had agreed to procure a Schedule of Rates agreement with the contractor in question, before the end of the current 2021-22 financial year.


Members had no issues with the other nine payments reviewed by Internal Audit [report paras 5.2 to 5.10 refers], and chose a further five payments for review with the outcome presented to the next meeting of the Board.




1.     That Members note the contents of the report;

2.     That Members endorse the Chairman’s proposal that Service Managers who did not institute Internal Audit recommendations be called before the Board to explain their non-compliance.