the
COURT
AUDIT COMMITTEE
MINUTES of the firstmeeting of the 2006/2007 academic year
held on Monday, 25th September, 2006, in Room 084, Queen Anne Court, Maritime Greenwich Campus, Old Royal Naval College, Park Row, Greenwich SE10 9LS,
commencing at 5.00 pm.
Present:
Mr R J Baglin (Chairman)
Mr S Atkinson
Mrs M McKinlay
Dr A Pugh
In attendance:
Mrs T A Brighton (Minutes Clerk)
Mrs L Cording (Secretary and Registrar)
Mr R V T Daly (Director of Finance)
Mrs A-M S Nelson
Mr M Grundy (External Auditor)
Ms G Callaghan (Internal Auditor)
Mr R Smith (Internal Auditor)
Apologies for Absence:Mr S Davie
06/1PRIVATE MEETING
The Audit Committee was preceded bya private meeting of the Members of the Committee.
06/2DECLARATION OF CONFLICTS OF INTEREST
There were no declarations of conflict of interests made.
06/3MINUTES OF PREVIOUS MEETING (A06/1)
The minutes of the meeting held on 22nd May 2006 were agreed and signed as a true record.
06/4AGENDA ITEMS 2006-2007 (A06/2)
The Committee agreed the list of agenda items for the 2006-2007 academic session, subject to the inclusion of two Value for Money Studies at the May 2007 meeting.
06/5DRAFT 2005/2006 AUDIT COMMITTEE ANNUAL REPORT (A06/3)
The Committee considered a preliminary draft 2006-2007 Annual Report. Members were asked to send any suggestions for amendment to the Minutes Clerk so that a revised version could be produced for more detailed consideration at the next meeting.
06/6EXTERNAL AUDIT
The External Auditor reported that preparation for the year-end audit was proceeding to timetable with the final audit visit scheduled to commence on 9th October 2006.
06/7BUSINESS CONTINUITY PLAN (A06/4)
The Committee welcomed the final version of the University’s Business Continuity Plan. It was noted that the Plan had been implemented with effect from the current academic year and that testing of the arrangements would take place later during the course of the year. It was also noted that a review of IT disaster recovery arrangements by the Internal Auditors was similarly planned for later in the year.
06/8VALUE FOR MONEY ANNUAL REPORT 2005-2006 (A06/5)
8.1 Value for Money Activities
The Committee received the Value for Money Annual Report for 2005-2006 and noted the value for money activities which had taken place during the year. The Committee was particularly pleased to note that, through the use of consortia agreements, frameworks agreements and competitive tendering, the Procurement Office had achieved savings on the provision of services and supplies in the region of £715,000 for the period.
8.2Value for Money Plan 2006-2007
The Committee considered the draft Value for Money Plan for 2006-2007 and noted that staff recruitment and student recruitment had been selected as proposed areas for value for money study. The Director of Finance explained the rationale for their selection; staff recruitment had been chosen because staffing resources accounted for 55% of the total recurrent budget, and student recruitment on the grounds that attracting students was key to the University’s business plan. He further explained that the studies would look at staff and student recruitment processes and the spend associated with them in order to assess whether they could be carried out in a way which provided better value for money. In both cases the studies would include examination of staff costs.
Whilst Committee Members supported the proposal for staff recruitment to be the subject of value for money study theyexpressed some reservations about the usefulness of the study on student recruitment. It was recognised that student recruitment is a complex area and the scope of any vfm study would require careful definition. Furthermore, it was noted that some examination of this areahad already been undertaken internally and concernsabout duplication of effort were raised. The Committee therefore requested University Officers to give further consideration to the terms of reference, thereby preventing any replication of earlier work.
06/9IMPLEMENTATION OF INTERNAL AUDIT RECOMMENDATIONS (A06/6)
The Committee received a chart reporting on the status of two overdue Priority 1 internal audit recommendations. The Director of Finance reported that implementation of the recommendation on identification of recoverable debt (cf Block 3 Income and Debtors report) had been delayed. At his request, some further system development work was being undertaken to ensure that the required objectives were met but he was confident that full implementation would take place by the end of October 2006.
06/10INTERNAL AUDIT
The Chairman welcomed Richard Smith, national head of Bentley-Jennison’s Internal Audit, Management and Consulting Division, and Gill Callaghan, the newly appointed Client Manager, to the meeting. The Chairman rehearsed the Committee’s previous concerns about how the merger of Pritchard Wood with Bentley-Jennison had been managed. Despite assurances about the quality of the future internal audit service, changes in personnel and slippages in the 2005/06 internal audit programme remained a concern. Richard Smith said that the Committee’s concerns were being addressed. He explained that the Block 4 2005-2006 report had been delayed because he had been unhappy with the quality of some of the work carried out. Arrangements were being made for the Auditors to revisit the areas in question as soon as practicably possible so that the report could be finalised quickly.
The Chairman reported that the Committee would next meet in November when a significant part of the business would centre around approval of documentation relating to the University’s year-end audit. He therefore hoped that the slippages in the work programme could be sorted out prior to then and believed, in addition, that the Committee would receive some comfort if the outstanding reports could be provided to them before that time. It was agreed that the Internal Auditors would work to the following timescale:
- Block 4 2005-2006 Report -by mid-October 2006
- Draft 2005-2006 Internal Audit Report -by end October 2006
and, on an exceptional basis, the Committee would consider the reports via correspondence. The reports would be submitted to the November meeting as a formal process.
10.1Internal Audit Needs Assessment 2006/2007 (A06/7)
Introducing the draft Internal Audit Needs Assessment for the year 2006/07, the Internal Auditors reported that the plan focussed on the areas of the University’s operations which were likely to generate the greatest risks to the achievement of the institutional objectives. The Plan allowed for a total of 22 audits, although it was noted that the allocation of days to some of the audits still needed quantification. Following examination of the Plan, the Committee agreedthat:
ithe following audits should be brought forward:
- Data Protection and Freedom of Information
- VAT
- Corporate Governance (specifically Registers of Interests and Gifts)
iiin order to avoid any duplication of effort with the proposed vfm study on staff recruitment (see para 8.2), the Internal Auditors and University Officers should agree together the detailed scope of the scheduled audit on HR Recruitment, Retention & Performance Management.
It was noted that 12 days had been provisionally allocated to a value for money study on the Students’ Union. The Secretary and Registrar reminded the Committee that the aim of the study was to review the Union’s provision of services and the number of days attributed to the review was still under discussion.
The Committee noted that for future meetings the Internal Auditors would provide a progress report on implementation of the internal audit plan.
10.2Final Internal Audit Report Block 2 2005/2006 (A06/8)
The Committee received the finalised Block 2 2005/06 Internal Audit Report on the following audit reviews:
BJ/02/06Corporate Governance
BJ/06/06Risk Management
BJ/10/06 Student Records and Information
The report had been amended to take into account the points made in discussion at the previous meeting.
10.3Internal Audit Report Block 3 2005/2006 (A06/9)
The Committee considered the Block 3 2005/2006 Internal Audit Report on the following audit reviews:
BJ/12/06Student Retention and Withdrawals
BJ/13/06 Student Pastoral Support
BJ/15/06School Review
BJ/16/06Use of Resources
BJ/18/06 Complaints Handling
BJ/19/06 Capital Development
BJ/23/06 Research and Enterprise Activities
The Committee noted that no recommendations had arisen from the audits on the School Review, Use of Resources, Capital Development and Research and Enterprise Activities. With the exception of the comment below, the ManagementResponses for the remaining Internal Audit Reports were regarded as satisfactory by the Committee and the Auditors.
10.3.1Internal Audit Report BJ/12/06: Student Retention and Withdrawals
The Committee noted that the policies and procedures in place to manage student retention and withdrawals were considered to be adequate and effective. University Officers had, however, not accepted the single recommendation arising from the review. In discussing the matter further, it became evident that there was some ambiguity to the recommendation. The Committee therefore sought clarification on the objective of the recommendation and also on the nature of University Officers’ objections and agreed to return to the matter at the next meeting.
10.4IT Security Review (BJ 02.06/07) (A06/10)
The Committee considered the findings, recommendations and Management Responses for the Internal Audit review on IT Security and was pleased to note that the controls audited had provided substantial assurance.
The Internal Auditor reported that, although issued separately, the IT Security Report formed part of the Block 4 report. Subject to the Committee’s endorsement, the Internal Auditors proposed to produce individual reports for all future audit reviews. The Committee confirmed that it was satisfied with the new format.
The meeting ended at 6.20 pm.
T.A.Brighton
5.10.06
LC/AuditCtte/Minutes/25 September 2006 Auditmins
Audit Committee: 25 September 2006 page 1