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							MINUTES                                                                               Item
5
Meeting:              Audit Panel
Date:                 Thursday 2 April 2009
Time:                 10am
Place:                Committee Room 5, City Hall, The
                      Queens Walk, London, SE1 2AA
Copies of the minutes may be found at:
[http://www.london.gov.uk/assembly/audit_panel_mtgs/index.jsp

Present

Navin Shah (Chair)
Richard Barnbrook
Roger Evans


1.     Apologies for Absence and Chair’s Announcements (Item 1)

1.1    Apologies for absence were received from Caroline Pidgeon AM.


2.     Declarations of Interests (Item 2)

2.1    Resolved:

       (a)     That the relevant Members’ declarations of memberships of Functional
               Bodies and London Borough Councils, as set out in the table at Item 2 on the
               agenda, be noted as personal interests; and
       (b)     That the gifts and hospitality received by Members as set out on the
               Authority’s gifts and hospitality register be noted.




City Hall, The Queen’s Walk, London SE1 2AA
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                                    Greater London Authority
                                          Audit Panel
                                          2 April 2009

3.    Minutes (Item 3)

3.1   Resolved:

      To confirmThat the minutes of the meeting of the Audit Panel held on 15 January
      2009 be signed by the Chair as a correct record.


4.    Summary List of Actions (Item 4)

4.1   The Panel received a the report of the Executive Director of Secretariat.

4.2   The Panel, whilst noting that it would receive a full report on the new Directorate and
      Corporate Risk Registers at its meeting of 16 July 2009, requested that an early draft of
      the Risk Management Framework be circulated to Members at the first opportunity.

4.3   Resolved:

      That the actions arising from the previous meetings of the Audit Panel be noted.


5.    Internal Audit Plan 2009-11 (Item 5)

5.1   The Panel received a the report of the Executive Director of Resources setting out:
         The Draft Internal Audit Plan 2009/10; and
         The Internal Audit Profile Plan for 2009/10.

5.2   The Panel agreed it would consider forward plan arrangements for 2009-10 in relation to
      the Internal Audit Plan in order to prepare a draft report on the matter for circulation to
      Panel Members and, if necessary, to arrange an informal meeting of the Panel.

5.3   In response to a question about the number and timing of Audit days devoted to the
      Olympic and Paralympic Games, the Internal Auditor agreed to review this with the
      Executive Director of Resources.

5.4   The Panel also requested that items omitted from the Internal Audit Plan be made
      available to Members.




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                                     Greater London Authority
                                           Audit Panel
                                           2 April 2009

5.5   Resolved:

      (a)      That, subject to the comments made in discussion and set out above, the
               Internal Audit Plan 2009-2011 be noted.
      (b)      That the profiled Internal Audit Plan 2009/10 be noted


6.    Internal Audit Reports (Item 6)

6.1   The Panel received the report of the Executive Director of Resources to which eight
      internal audit reports were attached. The reports were:
           Data Management and Analysis Group (DMAG)
           Cost of Mobile Phones and Blackberries
           Precepting
           Sundry Income and Debtors
           Ordering, Receiving and Payments
           General Ledger
           Expenses
           Recruitment

      Data Management and Analysis Group (DMAG) (Item 6a)

6.2   Members noted the number of recommendations in the report that had been challenged by
      the Head of DMAG. The Internal Auditor accepted that the report’s recommendations
      were challenged to a greater extent than is usually the case, and that whilst agreement on
      all recommendations is sought as a matter of course, the audit process does allow for
      disagreement where it can be justified and that all such responses to recommendations are
      monitored and discussed with the Resources Directorate.

6.3   The Internal Auditor also explained that disputed recommendations remain in follow-up
      reports if the auditors believed the recommendation should stand; however, no further
      follow-up action would be undertaken unless specifically requested by Members. It was
      suggested that, as part of the monitoring process, challenges to recommendations should
      be detailed in future follow-up reports.

6.4   In response to questions arising from recommendation four, Collection of Aged Debts,
      Members were informed that the scale of such debts was approximately £70,000 and that
      further details would be made available to Members following the meeting.




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                                     Greater London Authority
                                           Audit Panel
                                           2 April 2009

       Cost of Mobile Phones and Blackberries (Item 6b)

6.5    Whilst accepting the auditors’ assessment of risk in relation to recommendation one,
       review of the current costing system, the Head of Financial Services explained that the
       current itemised billing system invoiced all users whose costs exceed £5 and the process is
       overseen by a dedicated officer. It was therefore considered an appropriate level of
       resources for the task and sufficient to mitigate any risk. Additionally, the process would
       be strengthened by sending copies of bills in excess of £100 to the service director and
       ensuring that all declarations for personal usage would be submitted (including nil
       returns). It was noted that the system applied to both Members and officers alike.

6.6    The Executive Director of Resources explained that, following a bill incurred by an
       Assembly Member undertaking Assembly business when out of the country, Members
       have been advised not to use Blackberries when abroad.

       Sundry Income and Debtors (Item 6d)

6.7    It was explained that the London Development Agency (LDA) debt of £4.5 million,
       detailed in paragraph 30 of the report, was an outstanding sum relating to events, such as
       New Year’s Eve, and which only appeared as a debt due to the timing of the audit. The
       inclusion of the figure as a debt was part of the annual funding arrangement between the
       GLA and the LDA.

6.8    Members were also informed that the process for dealing with debts had been improved
       over the year with a dedicated officer to manage debts and new performance indicators for
       measuring debt introduced from April 2009. The cross-training of staff to perform debt
       recovery procedures, identified at recommendation four, had been implemented since
       February 2009.

       Expenses (Item 6g)

6.9    The Panel was advised that the revised Expenses and Benefits Framework has been agreed
       by the Mayor and the Assembly. The Executive Director of Resources undertook to
       circulate a copy of the Framework to Members of the Panel.

6.10   In response to the suggestion that there should be regular monitoring of the credit card
       log sheets, recommendation three, Members were told that managers had disagreed with
       the recommendation on the grounds that the current system worked well, namely the
       Head of Financial Services held the corporate card and only approved legitimate
       expenditure. Moreover, all invoices remained in dispute and unpaid until the user provides
       the credit card log for processing.

6.11   In terms of foreign travel approval, Members were informed that the process had been
       modified so that no payments would be made on a purchase order until the foreign travel
       approval form had been returned.

6.12   The system for seeking user declaration returns for taxi journeys had also been reviewed
       and the process for escalation procedures for senior staff and Members had been
       implemented..

6.13   Resolved


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                                    Greater London Authority
                                          Audit Panel
                                          2 April 2009

      That, subject to the points raised in discussion and set out above, the Internal Audit
      Reports be noted.

7.    Internal Audit Follow Up Reports (Item 7)

7.1   The Panel received the report of the Executive Director of Resources which set out the
      progress on implementing the recommendations on the following internal audit follow-up
      reports:
       Absence Management
       Payroll Spot Checks
       Remuneration
       Use of Agency Staff
       London TravelWatch

7.2   Resolved:

      That the internal audit follow up reports be noted.


8.    Internal Audit Performance – Internal Audit Assurance Report (Item 8)

8.1   The Panel received the report of the Executive Director of Resources which measured the
      performance of the contractor in delivering the internal audit service.

8.2   In response to Members’ concerns about the performance of the contractor in relation to
      the performance measures for the percentage of draft audit reports issued on time, and the
      percentage of responses to the draft report on time (60% and 56% respectively), the Panel
      was informed that delays had been caused by a combination of the volume of ongoing
      audits between December 2008 and January 2009, the organisational change in the GLA
      which had created delays in finalising reports, and additional testing of some reports
      undertaken at the request of management. Members’ concerns were noted by the Internal
      Auditor.

8.3   Resolved:

      That the performance of the Internal Audit Contractor be noted.

9.    Monitoring of Expenses 2008/09 – Mayor and Elected Members (Item
9)

9.1   The Panel considered the report of the Executive Director of Resources, which set out the
      expenses incurred by the Mayor and London Assembly Members for the period 1
      November 2008 to 31 January 2009.

9.2   The Executive Director of Resources clarified that the amount for the Mayor’s taxi
      invoices, as indicated in the appendix to the report, should be £1501.

9.3   Members were concerned about the level of Assembly Member taxi expenses. The
      Execuitve Director for Resources explained that the recently reviewed Expenses and
      Benefits Framework emphasised Members’ requirement to only use taxis where necessary.

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                                    Greater London Authority
                                          Audit Panel
                                          2 April 2009

9.4    Resolved:

       That the expenses incurred by the Mayor, noting the revised figure provided for the
       Mayor, and London Assembly Members during the period 1 November 2008 to 31
       January 2009 be noted.


10.    Monitoring of Expenses November 2008 to January 2009 – Senior Staff
       (Item 10)

10.1   The Panel considered a report of the Executive Director of Resources.

10.2   Following Members’ comments about the broad categorisation of business expenses, as
       detailed in paragraph 3.4 of the report, the Executive Director of Resources agreed to
       provide a breakdown of items related to expenses if it is a figure over £1000.

10.3   Resolved:

       That the expenses incurred by senior staff during the period 1 November 2008 to 31
       January 2009 be noted.


11.    Date of Next Meeting (Item 11)

11.1   The next scheduled meeting of the Panel would be on 16 July 2009.




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                                    Greater London Authority
                                          Audit Panel
                                          2 April 2009



12.     Any Other Business the Chair Considers Urgent (Item 12)

12.1    There was no urgent business.


13.     Close of Meeting

13.1    The meeting ended at 11.15am.




Chair                                              Date

Contact Officer:     Teresa Young, Committee Co-ordinator
                     Telephone: 020 7983 6559
                     Email: teresa.young@london.gov.uk




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