Agenda and minutes

Eastbourne Borough Council Audit and Governance Committee - Wednesday, 28th July, 2021 6.00 pm

Venue: Court Room at Eastbourne Town Hall, Grove Road, BN21 4UG

Contact: Committee Services on 01323 410000 

Note: Note: This meeting is a public meeting. The number of public seats, however, are limited and need to be carefully managed to ensure that the meeting is Covid-secure. For this reason, we would like to ask that anyone intending to attend as a member of the public, contact Democratic Services in advance by email: or phone: 01273 471600. Anyone attending the meeting will be requested to check in at the venue and to wear a face covering. 

No. Item


Minutes pdf icon PDF 180 KB

To confirm the minutes of the last meeting of the Committee.


The Minutes of the last meeting on 3 March 2021 were approved.


Apologies for absence/declaration of substitute members


Apologies were received from Councillor Diplock and CFO, Homira Javadi.


Declarations of Disclosable Pecuniary Interests (DPIs) by members as required under Section 31 of the Localism Act and of other interests as required by the Code of Conduct.


There were no declarations of interest.


Questions by members of the public.

On matters not already included on the agenda and for which prior written notice has been given (total time allowed 15 minutes).


The Chair reported that no questions had been submitted.


Urgent items of business.

The Chairman to notify the Committee of any items of urgent business to be added to the agenda.


There were none.


Right to address the meeting/order of business.

The Chairman to report any requests received to address the Committee from a member of the public or from a Councillor in respect of an item listed below and to invite the Committee to consider taking such items at the commencement of the meeting.



The Chair reported a request from Councillor Smart to address the Committee regarding items 7 and 9. The Chair agreed that Councillor Smart could speak for up to five minutes before the commencement of each item.



External Auditor (Deloitte) report on the 2018/19 Statement of Accounts pdf icon PDF 231 KB

Report of the Chief Finance Officer.

Additional documents:


The Chair then invited Councillor Smart to address the Committee regarding item 7 and thanked him for his comments.


The Chair invited Ola Owolabi, Deputy Chief Finance Officer (DFCO), to present the report.


The DFCO explained that the Statement of Accounts was an update of the version considered by the Committee at the November meeting and that the outstanding issues at that time had been resolved. The Council was now in a position to sign a Letter of Representation, to formally and publicly confirm the correctness and completeness of the auditing of accounts for 2018/19.  The DFCO then invited Ben Sheriff, Deloitte, to present the report from Deloitte, External Auditors, (Appendix A of the report) regarding ISA 260.


The Chair thanked Ola Owolabi, DCFO, and Ben Sheriff, Deloitte, and invited comments and questions from Members as they considered the report.


During the following discussion Members noted the volume and complicated nature of the material associated with the agenda and requested that Officers consider the amount, relevance and accessibility of agenda materials going forward.


Points of clarification from Officers included:

·         That there were statutory requirements regarding what should be included in the Statement of Accounts and how it should be presented, in compliance with the International Financial Reporting Standards/CIPFA Code, and that the main purpose of the covering report was to provide a more accessible, narrative summary.


·         That a segmental income analysis could be provided.  However, it was noted that the detail had significantly changed since the time of the report i.e. 2018/19.


·         That the original timescale for delivery of externally audited accounts agreed with Deloitte at the start of 2021 was: 2018/19 by April / May; 2019/20 by end of July 2021 and 2020/21 by end of September 2021. Work on the 2019/20 accounts had now started. 


·         Deloitte noted that resource issues at Deloitte had contributed to the delays.


·         That the Chief Internal Auditor would liaise with CMT regarding possible inclusion of risks identified in the External Accounting within the Strategic Risk Register.


·         That Officers would provide an explanation of the increased employment costs to Members of the Committee. 


·         That Officers would liaise with the Chair to set up pre-committee briefing meetings, to aid Members’ understanding of material due to be considered by the Committee that was of a particularly complicated nature.


Regarding ICE (Investment Company Eastbourne Ltd) in particular:


·         Officers clarified that the complicated nature of the ICE joint venture (the Council’s investment company) had contributed to the delay of the audit, but that there was now an agreed accounting model which would be used going forward.  The cash receipt of £2m was banked but that there had been changes in the way the ICE transaction and accounting were presented within the accounts.Officers also clarified that the report’s comment that “the final contractual structure [of ICE] was not the one approved by Council in 2017”, referred to the structure for accounting and not the structure of the commercial venture / business proposition itself, which was essentially the same.  ...  view the full minutes text for item 7.


External Audit 2019/20 Report

A verbal update from External Auditor, Deloitte, and Eastbourne Council Officers.


With agreement of the Chair, this Item was taken together with Item 7 and the decision noted in resolution point 4, Item 7. 


Redmond Review update and MHCLG External Audit Consultations pdf icon PDF 227 KB

Report of the Chief Finance Officer.


The Chair invited Councillor Smart to address the Committee re item 9. Councillor Smart spoke for five minutes and the Chair thanked him for his comments.


The Chair invited Ola Owolabi, Deputy Chief Finance Officer (DCFO), to present the report.


The DCFO summarised the scope and progress to date of the Redmond Report and the recent response to the report from Central Government, as outlined in the White Paper, ‘Restoring trust in audit and corporate governance’.


A key recommendation of the Redmond Review was to create an Office of Local Audit and Regulation (OLAR). The Government’s White Paper recommended creating a new body – the Audit, Reporting and Governance Authority (ARGA) – which would replace the Finance Reporting Council (FRC) and would also be charged with providing oversight of local authority audit. 


The PSAA (Public Sector Audit Appointments Ltd) would continue to have oversight of appointing individual local authority auditors.


The Audit and Accounts Regulations had been amended to extend the date to produce audited accounts from 31 July to 30 September for a period of 2 years until 2023.


Resolved (unanimous)

  1. To note this report



Treasury Management Annual Report 2020/21 pdf icon PDF 762 KB

Report of the Chief Finance Officer.


Ola Owolabi, Deputy Chief Finance Officer (DCFO), presented the report, which was a statutory requirement. The report had been previously approved by Cabinet and had come before the Audit and Governance Committee to be noted.


The Chair thanked the DCFO for his presentation and the Committee considered the report.


Officers clarified queries regarding the changes in projections, and the impacts of COVID-19 – including interest rate forecasts and the requirement of the Council to manage significant amounts of money from Central Government for local business support grants.


Resolved (unanimous):

  1. To note the report.


Annual Governance Statement Report pdf icon PDF 305 KB

Report of the Chief Internal Auditor.

Additional documents:


Jackie Humphrey, Chief Internal Auditor (CIA), presented the report, which included explanations of the Audit Team’s work to review and improve accessibility of the information contained in the report, how the ‘manager feedback’ had been analysed and presented, and the Council’s approach to document retention requirements.


It was noted that work over past months regarding the new Housing System software had meant that this was now no longer classed as a ‘significant’ issue.  Specific additions to the report included sections on Covid-19 and the Council’s investment company, ICE.


At the request of the external auditors, Deloitte, additional information for the previous years would be published as an addendum.


The Chair thanked the CIA for the report and invited comments and questions from the Committee Members.


Officers responded to Members’ questions regarding the inclusion of companies in the Annual Governance Statement. 


Resolved (unanimous)

  1. To approve the Draft Annual Governance Statement 2020-21; and
  2. To approve the addendum to the Annual Governance Statements for 2018-19 and 2019-20. 


Internal Audit and Counter Fraud Report for the financial year 2020-2021 pdf icon PDF 339 KB

Report of the Chief Internal Auditor.

Additional documents:


Jackie Humphrey, Chief Internal Auditor (CIA), presented the report to the Committee.


The report highlighted some of the key effects of Covid-19, including: impacts on the Audit Team’s resources,  that the Tourism Team had not been audited as had not been active,  and that the Audit Team structure was currently under review.


The work of the Counter Fraud Team was reviewed and two new projects were highlighted: the performance analysis of the grants portal, and one to recoup money from housing debtors.


An error in Appendix C was brought to the attention of the Committee, and Members were assured that it did not affect the quoted net annual total. 


The next external review had been scheduled for 2022/23; the slightly later date was due to alignment of work across both Councils.


Following concerns raised by Members regarding the rates of assurance, Officers clarified that all items rated less than ‘substantial’ were followed up.  However, in the interests of managing the amount of information shared with Members, only unresolved items were brought back to the Committee.  Officers agreed to consider ways to provide updates of the items which were followed up to the Committee going forward.


The CIA clarified in relation to a reported instance of ‘no assurance’, that whilst an investigation had found that there were no incorrect processes in use, the process itself was not formally recorded.



  1. To note the report; and
  2. That Officers review the additional information requirements identified by Members during the meeting for future reporting.


Strategic Risk Register Quarterly Review pdf icon PDF 187 KB

Report of the Chief Internal Auditor.

Additional documents:


Jackie Humphrey, Chief Internal Auditor (CIA), presented her report. It was noted that, following a review by the Corporate Management Team (CMT), the Covid-19 risk level had been reduced, apart from the financial element.


The Chair thanked the CIA and the Committee considered the report.


Officers clarified the distinctions between amber and red classifications and explained that amber and red issues were addressed through a cascade from CMT down to the relevant departments and management teams. Officers confirmed that the current review cycle was quarterly.  The Chief Internal Auditor agreed to take comments from the Committee back for consideration by CMT, and to report back at the next Committee meeting.


Resolved (unanimous)

  1. To note the report.