It was noted that apologies for absence had been received from Councillor Butler.

There were no Substitute Members.

The Chairman stated that, in his opinion, the report of the Head of Finance relating to the Audit Commission’s Annual Governance Report 2008/09 should be taken as an urgent item to enable a recommendation to be made to the Council regarding the amended Statement of Accounts for 2008/09.

Councillor Mrs Wilson indicated that she was attending the meeting as an observer.

There were no disclosures by Members or Officers.

There were no disclosures of lobbying.

RESOLVED:  That the items on the agenda be taken in public as proposed.

RESOLVED:  That the Minutes of the meeting held on 15 June 2009 be approved as a correct record and signed.

Minute 25 - Audit Commission’s Audit and Inspection Fee Letters

At the request of the Chairman, Ms Hill provided a preliminary explanation of the changes to the fee levels, particularly the inspection fee.  It was noted that the proposed audit fee for 2009/10 was £109,020, an increase of £2,202 on the 2008/09 fee, or 2% overall.  The largest increase was in relation to inspection/assessment which was based on the standard fee set by the Audit Commission.  This increase was particularly significant for Maidstone due to the move to the new CAA framework.  As an “Excellent” Council under the previous CPA, inspection activity was limited and there were no additional risk based inspections.  The Corporate Assessment, part of the CPA, was not undertaken annually and was only required as part of a re-categorisation.  A letter setting out the rationale for the changes could be made available to Members.

RESOLVED:  That the position be noted and that the Audit Commission’s letter setting out the rationale for the changes to the fee levels should be circulated to all Members of the Committee.

Minute 28 - Data Transfer to the Traffic Enforcement Centre

The Head of Internal Audit and Risk Strategy advised the Committee that, notwithstanding the representations made to the various organisations, the concerns over data transfer between the Council and the Traffic Enforcement Centre had not yet been resolved.

The representatives of the Audit Commission gave a short presentation on the Council’s Use of Resources Assessment for 2008/09.  It was noted that:-

·  A new approach had been adopted for 2008/09 which measured how well organisations were managing their resources to deliver value for money and sustainable outcomes for local people; had a greater focus on value for money achievements, outputs and outcomes rather than on processes; and contributed to the Audit Commission’s organisational assessment, alongside its work on managing performance.

·  The Audit Commission’s overall assessment was that the Council had strong arrangements in place to manage its finances, govern the business and manage other resources.  There was a clear link between corporate objectives, medium term financial planning and service delivery and a very good governance and decision making process.  Performance management was well established and service planning was robust.  The Council was leading in Kent on several benchmarking and business transformation initiatives.  The success of these would be critical in enabling the Council to sustain a secure financial position and continue to deliver against stretching efficiency targets.

·  The national quality assurance process had been completed and overall the Council had achieved a score of Level 3 (Performs consistently well - delivers strong outcomes for local people).

Members and Officers were disappointed and concerned that the Council had not scored a 4 in respect of any of the eight key lines of enquiry.  The representatives of the Audit Commission explained that there had been extensive consultation on the new scoring system; it was much harder to achieve a score of 4 and the fact that Maidstone had scored a 3 did not mean that there had been a deterioration in the service provided.  Claire Bryce-Smith, the Audit Commission’s lead on Comprehensive Area Assessment, would attend the next meeting to explain the new marking arrangements.

A Member referred to the costs associated with the preparation of the Council’s submission, including the case studies.  The Officers explained that the evidence had been submitted at each stage of the process and the majority of the data would have been produced in any event for performance management purposes.

The representatives of the Audit Commission then drew the Committee’s attention to the results of the assessment in respect of each key line of enquiry, including the strengths identified and the issues for the Council to consider, and to the issues to be focused on in the 2009/10 assessment.

The Committee asked a number of questions of the Officers and the representatives of the Audit Commission relating to, inter alia, the staffing implications of the more challenging reporting requirements of IFRS; spot checking; developing the governance role of the Audit Committee; equality impact assessments; and the suggested new line of enquiry for the 2009/10 assessment (natural resources - reducing the Council’s carbon footprint and encouraging a reduction in CO₂ emissions in the Borough).

The Officers expressed the view that there were at least two areas where the Council might have expected to achieve a  ...  view the full minutes text for item 40.

The Committee considered the report of the Head of Finance concerning the audit of the Statement of Accounts for 2008/09 and the Audit Commission’s Annual Governance Report.  It was noted that:-

·  A number of misstatements had been identified during the course of the audit and the financial statements had been adjusted as summarised in Appendix B to the report of the Head of Finance.

·  There was still one outstanding issue concerning the accounting for the penalty charges in respect of the London House lease and the related disposal of the car park and the advice of the Audit Commission Technical Team was awaited.

·  The five recommendations arising from the audit were essentially of a technical nature and would be addressed by the Officers.

·  Subject to agreement on the outstanding adjustment, the Audit Commission proposed to issue an opinion that the financial statements presented fairly the financial position of the Authority along with an unqualified value for money conclusion on the Council’s arrangements for securing economy, efficiency and effectiveness in its use of resources.

The Committee asked a number of questions of the Officers and the representatives of the Audit Commission relating to, inter alia, the wording of the draft letter of representation; the response to the public consultation exercise on the accounts; the discussions with Kent County Council regarding the amount payable in respect of the Gateway; the understatement of liabilities due to work on the new depot to 31 March not being accrued; the interpretation of the word “impairment”; and the implications for decision making of fixed assets being understated in the cash flow statement.

RESOLVED to RECOMMEND to the COUNCIL:

1.  That the Audit Commission’s Annual Governance Report 2008/09, attached as Appendix A to the report of the Head of Finance, be considered by the Council.

2.  That subject to correcting entries for the penalty charges in respect of the London House lease and the related disposal of the car park being agreed, the amended Statement of Accounts for 2008/09 be approved.

3.  That in the event of the outstanding issue in respect of the accounts not being resolved in time for the Council meeting, the Director of Resources and Partnerships be given delegated authority, in consultation with the Leader of the Council, to approve the amended Statement of Accounts for 2008/09 subject to the correcting entries being agreed.    

6.30 p.m. to 8.10 p.m.