Agenda and minutes

Apologies for absence were received from Alderman Prem Goyal, Alderman Alexander Barr, Alderman and Sheriff Bronek Masojda, Dan Worsley, Ruby Sayed, James St John Davis. It was noted that Naresh Sonpar and Judith Pleasance were in attendance online.

There were no declarations.

To agree the public minutes and non-public summary of the previous meeting held on 13 May 2024.

RESOLVED – That, the public minutes and non-public summary of the meeting held on 13 May 2024 be agreed as a correct record.

To receive the minutes of the meeting of the Nominations and Effectiveness Sub Committee held on 6 June 2024.

The Committee received the minutes of the Nominations and Effectiveness Sub-Committee.

Member are asked to note the Committee’s Outstanding Actions List.

Members received the Outstanding Actions and noted the updates from officers.

The following points were noted:

• Officers noted the update on the meeting with school chairs and principals, which had been challenging to coordinate due to diary conflicts. It was suggested to proceed with the meeting even if some heads were unable to attend.
• A recommendation was made to arrange separate meetings with the heads and chairs of the committees to ensure future meetings take place.

Member are asked to note the Nomination and Effectiveness Committee’s Outstanding Actions List.

Members received the Outstanding Actions and noted the updates from officers.

Member are asked to note the Committee’s Work Programme.

The Committee’s Work Programme was noted.

Report of the Chamberlain.

The Committee considered a report of the Chamberlain concerning a blueprint for how Internal Audit will operate and allows the governing body to clearly signal the value it places on the independence of Internal Audit.

The following points were noted:

• The content of the charter was almost a direct lift from the global internal audit standards with some adaptations for public sector requirements.
• The Committee is confirming the authority of internal audit by approving the charter.
• There was a discussion on whether the Committee, on behalf of the Common Council, was authorising internal audit to use whatever resources and speak with any departments within the organisation.
• It was noted that there were some limits to the resources, but the power should be used wisely.
• There were questions about who approves the mandate for internal audit and who oversees its implementation.
• It was clarified that there are no fundamental changes in emphasis, and the implementation oversight question would be taken away for further clarification.
• The Committee agreed to approve the charter subject to the clarifications being provided via email.

RESOLVED – That Members, in accordance with the requirements of the Global Internal Audit Standards, approve the Internal Audit Charter.

Report of the Chamberlain.

The Committee received a report of the Chamberlain concerning an update on the publication and audit of the 2023/24 Statement of Accounts for the City Fund and Pension Fund.

The following points were noted:

• The Committee expressed appreciation for the efforts made by officers in getting the accounts to a stage where they could be discussed in the summer of 2024.
• It was noted that the audit for the City Fund was starting, and there was a clarification that the backdrop has been dropped, but it did not affect the City Fund audit work.
• There were questions about the backdrop and its implications, with an update provided that the general election had caused a pause in the backstop arrangements but was expected to be picked up by the new government.
• The audit is underway and on track, with expectations to finish within the calendar year.

Report of the Chamberlain.

The Committee received a report of the Chamberlain concerning an update on the 2023/24 external audit plan for City’s Estate Group and other charities.

The following points were noted:

• The consolidation and production of the accounts had been completed by the team, and they were now in the review stage.
• The team is working on reviewing the working papers and ensuring their quality, with two senior members conducting reviews.
• Crowe has been working closely with the team to ensure the audit is on track.
• Crowe representatives provided insights into the audit planning reports, highlighting no significant changes in accounting standards or auditing standards.
• The audit planning reports for City's Estates and City Bridge Foundation were discussed, with a focus on significant risks, key management judgments, and estimates.
• The importance of maintaining independence and the need for adequate resourcing for the audit were emphasised.
• The fee increases for certain entities were explained as a result of both the complexity of the audits and the need for better resourcing.

Report of the BHE & Charities Finance Director.

The Committee received a report of City Bridge Foundation & Charities Finance Director concerning various matters relating to the audit of the annual report and financial statements of CBF for the year ended 31 March 2024.

The following points were noted:

·        The Committee holds an advisory role in relation to the Statement Foundation vote on other matters.

• Planning discussions took place between City Bridge Foundation officers and Crowe, starting last week.
• The charity has a hard deadline of submitting its final accounts to the Charity Commission on 31st January 2025.
• Crowe representatives provided insights into the audit planning reports, highlighting no significant changes in accounting standards or auditing standards.
• The importance of maintaining independence and the need for adequate resourcing for the audit were emphasised.
• The fee increases for certain entities were explained as a result of both the complexity of the audits and the need for better resourcing.

Report of the Chamberlain.

The Committee received a report of the Chamberlain concerning an overview of the standards and relevant information to aid the Committee in supporting the transition to the new standards

The following points were noted:

• Officers noted the report provided an overview of the key information that the Committee needed to be aware of in relation to the new standards.
• It referenced wider reading and notes that there would likely be more specific training provided.
• The London Heads of Audit Group were currently working together on this, and updates would be provided in due course.
• The revised public sector internal audit standards were being developed, with timing to be confirmed.
• The new standards were expected to confirm some of the anticipated adaptations.
• The Committee discussed the feasibility of the internal audit team reviewing the standards and identifying any necessary changes.
• The Institute of Internal Auditors was putting together a tool or framework to support internal audit functions in understanding what needs to be done differently.
• The tool was expected to be released by the November committee meeting.
• The Committee agreed to receive an update at the next meeting and a gap analysis paper at the November meeting to identify any changes needed before the January 2025 deadline.

Report of the Chief Strategy Officer.

The Committee received a report of the Chamberlain concerning an update on the corporate and top red departmental risk registers since they were last reported to the Committee in May 2024.

The following points were noted:

• The report highlighted the dynamic nature of risk reporting, where changes occur frequently. An apology was issued for a missed risk update related to tree maintenance, which was later communicated via email.
• There were health and safety concerns related to the art installation at the Barbican Centre. The London Fire Brigade conducted an inspection and recommended remedial actions, including dampening the installation to reduce fire risk.
• The corporation's appraisal target was 80%, it was noted that 81% had been achieved excluding institutions. Including institutions, the figure was 73%, with expectations for it to increase as more returns come in.
• The corporate risk CR39 focused on recruitment and retention, particularly in light of the new workplace attendance policy requiring a minimum of three days a week in the workplace.
• A risk related to casual staff and pensions has been de-escalated due to better information on the scale and numbers impacted.
• It was noted that Chief officers now have a standing objective related to risk management, and their performance will be monitored accordingly.
• Members were informed that a review of risk appetite and culture was underway, with a full report to be presented in the non-public section of the meeting.
• There is ongoing training for staff responsible for updating risks, and efforts are being made to improve the risk management system.
• The funding for tree maintenance was being reviewed to ensure resources are available for necessary activities.
• The tree maintenance risk has been escalated to the corporate risk register for a finite period due to its wide impact across the organisation.

Report of the Chamberlain.

The Committee received a report of the Chamberlain concerning Internal Audit’s deep dive reviews in relation to CR01 Resilience and CR36 Protective Security.

Officers highlighted that the risk registers may not fully reflect actual risk management practices. Additionally, there was difficulty in determining the likelihood of achieving target risk scores by target dates due to varying interpretations of what these dates signify.

There were no questions.

There was no urgent business.

MOTION, that – under Section 100(A) of the Local Government Act 1972, the public be excluded from the meeting for the following items on the grounds that they involve the likely disclosure of exempt information as defined in Part I of the Schedule 12A of the Local Government Act.

RESOLVED, that – under Section 100(A) of the Local Government Act 1972, the public be excluded from the meeting for the following items on the grounds that they involve the likely disclosure of exempt information as defined in Part I of the Schedule 12A of the Local Government Act.                                                        

To agree the non-public minutes of the previous meeting held on 13 May 2024.

RESOLVED – That, the non-public minutes of the meeting held on 13 May 2024 be agreed as a correct record.

There were several questions.

There was no urgent business.