Agenda item
Outcomes of the Audit Task Group (to follow)
Minutes:
The Leader welcomed Councillor S. Colella to the meeting and invited him to speak in his role as the Chairman of the Audit Task Group.
It was highlighted that the Task Group’s key objective was to understand how the Council had arrived at the Section 24 Notice, issued in October 2022. The final report included lessons learned for the future and 15 recommendations for the Council to implement going forward.
Cabinet was informed that the Task Group had met for 22 hours in total and had reviewed a significant amount of background documentation, including notes from the Enterprise Resource Planning (ERP) System Project Board. Eleven interviews were carried out with a number of Members and Officers, including the Leader, the Portfolio Holder for Finance and Governance and the Chief Executive of Bromsgrove District Council.
Following the detailed and robust investigation it was concluded that there had been no alternative for the Council’s external auditors, Grant Thornton, to issue the Section 24 Notice in light of the non-delivery of the 2020-2021 Accounts. Furthermore, the Task Group had found that there had been failings in the implementation of the ERP system including staffing levels. It was noted however, that Members felt that these failings were not endemic across the Council nor had the Task Group identified any significant cultural issues in the Council.
The Covid-19 pandemic, including new ways of working remotely, coupled with significant issues experienced with the Cash Receipting module had also greatly impacted on the implementation resulting in a ‘perfect storm’.
Councillor Colella thanked the Officers who provided support throughout the investigation including the Interim Section 151 Officer, the Head of Legal, Democratic and Property Services, the Head of Finance and Customer Services and the Principal and Senior Democratic Services Officers.
In concluding the presentation of the report, Councillor Colella noted that, to the credit of the Council, it had recognised the need to review the implementation of the ERP system and that Officers and Members had participated fully and openly in the review.
The Leader thanked Members of the Audit Task Group for their hard work during the investigation.
RESOLVED that:
1. The Council ensure that subject specialists, internal or external, are involved in the design of relevant procurement specifications for all major projects.
2. Given a number of substantial and important projects on the horizon for Bromsgrove District Council, the authority set up a permanent Project Management Office to support the full range of projects undertaken by the Council. This Project Management Office would report to CMT/ SMT as part of its remit. CMT to be tasked with setting out the requirements of this new programme office and resource requirements to ensure compliance with the recommendations in this Report. This report will be presented to the first Cabinet meeting after the elections in May 2023.
3. In order to establish that a system chosen is fit for purpose, future scoring criteria as part of all procurement exercises will include the need for evidence that the system on offer to the Council is tried and tested.
4. Internal Audit should be cited on all major projects, together with a professional member of the Project Management Office. If necessary, independent or peer validation of technical specifications and/or bid due diligence should be considered.
5. Staff required on any major projects should be backfilled, to ensure no work over-load impacting Council staff well-being.
6. Should staff training be required as part of any new system or project implementation, the Council as a purchaser of that system/solution, should ensure that all training requirements are included as part of the project specification.
7. The Agile Working Policy should take account of the need, from time to time, for officers to work collaboratively and in line with the needs of the project.
8. The Council should fully and accurately record action points at project board meetings (and potentially, other Council meetings). They should then be implemented by the specific person responsible and reported upon at the following project meeting within a suitable and reasonable time scale. Where this is not possible, there should be RAG rating to escalate this further, to secure a suitable resolution is discussed by the relevant project team.
9. Officers, as a standard Report, will highlight to Audit, Standards and Governance Committee any possible finance and governance issues in the next six months not delivering to standard or timescales. This will include the timescales of delivery of finance training, delivery of VAT returns, delivery of the 2021/22 and 2022/23 accounts.
10. The Corporate Risk Register to be discussed as an early item on the agenda at meetings of the Audit, Standards and Governance Committee. Any risks are to be clearly flagged to the members of the Committee, particularly where they are rated as red.
ERP Recommendations
1. All finance staff and Council users be trained as a matter of urgency and no later than by 31st August 2023 on how to use the ERP system and that the progress with this be reported to the next meeting of the Audit, Standards and Governance Committee as a regular agenda item.
2. The Council to work with a specialist with the knowledge of the TechOne system and Cash Receipting to help in real time with the completion of the implementation of the new ERP system and all of its components and to help with any training needs and improvements to the system.
3. VAT returns to be up to date for 2020-21 and 2021-2022 by the end of May 2023 and for 2022-2023 by the end of August 2023.
4. The 2021-2022 Accounts to be in draft format by 30th June 2023.
5. The 2022-2023 Accounts to be in draft format by 30th September 2023.
(All of the above milestones will be dependent on resources and will be reported to the Committee as per recommendation 9 above.)
Supporting documents:
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