Minutes of Proceedings
Session: Session currently unavailable
Date: 16 October 2019
WEDNESDAY, 16 OCTOBER 2019 at 2.00PM
ROOM 106, PARLIAMENT BUILDINGS
Jim Wells MLA
Lesley Hogg, NIA
Rodney Allen, NIAO
Tara Caul, NIA
Gareth McGrath, NIA
Richard Stewart, NIA
Paula McClintock, NIA
Eddie Kelly, NIA
Ashleigh Mitford, NIA
The meeting commenced at 2.00 pm.
Derek Martin stated that, in the absence of the SARC Chairperson, SARC’s Terms of Reference provided for the independent member to preside over SARC meetings.
Derek went on to say that Brian Moreland, Head of Internal Audit, was retiring and he wished Brian well on behalf of SARC.
Apologies were received from Jim Brooks, Chairperson.
2. Declaration of Interests
No Declarations of Interests were made at this point however, Jim Wells MLA declared an interest as a trustee (and member) of the Northern Ireland Assembly Members Pension Scheme, during agenda item 7.
3. Minutes of Previous Meeting
Minutes of the previous meeting, held on 18 June 2019, were approved without amendment.
4. Matters Arising
It was noted that the action points from the meeting on 18 June 2019 had been completed.
Paula McClintock joined the meeting at 2.04 pm.
5. Internal Audit Charter Update
Eddie Kelly, acting Head of Internal Audit, presented a revised Internal Audit Charter (the Charter) that was approved by the Secretariat Management Group (SMG) in September 2019. The previous Charter had been agreed in 2014 and the revised Charter was developed to reflect evolving professional requirements and changes in the organisation. Eddie stressed that the
Charter would not result in changes to the Internal Audit approach, but rather
that it better reflected the purpose, authority and responsibility of the Assembly Commission’s Internal Audit Unit.
Derek said that the updated Charter was comprehensive and a close reflection of what SARC expected from the Internal Audit Unit.
SARC members noted the updated Charter.
6. Internal Audit Activity Update
Eddie provided an overview of Internal Audit activity since 1 April 2019 and then provided a summary of the final reports issued since the June 2019 meeting of SARC.
Eddie advised SARC members that 3 final reports had been issued since June 2019. The final Review of Support Services Report was issued on 8 July 2019 and contained 7 recommendations, 6 of which were accepted by management and 1 of which was partially accepted. Eddie provided an overview of the recommendations and advised SARC that the assurance level was satisfactory.
Derek said that there were a number of issues identified in the Review of Support Services Report and that it was good to see that all were accepted, with the exception of one which was partially accepted, and that the assurance level was satisfactory. He cautioned however that the issues had
been highlighted in the context of reduced activity and asked that senior management keep a close watch on the implementation of the audit recommendations. Derek remarked that, although the issues were not unusual, in the event of increased activity, any unaddressed weaknesses
could result in more significant issues arising.
Eddie advised SARC members that the final Review of Legal Services Report was issued on 7 August 2019 and contained 2 recommendations, both of which were accepted by management. Eddie provided an overview of the recommendations and advised SARC members that the assurance level was substantial.
Eddie said that the Review of Members Expenses 2018-19 (Final Testing) Report was issued on 10 September 2019. Eddie advised that Internal Audit was satisfied that there was nothing further to note since the interim report was issued in May 2019. He told SARC members that the overall level of assurance for the full year was satisfactory.
Jim Wells MLA observed that the reduction in Members’ expenses should have made for a straightforward audit and that it may have been more complex if the Assembly was up and running.
Eddie briefed SARC members on reviews that were ongoing, namely: planned and reactive maintenance; Events; the Equality & Good Relations Unit; the review of broadcasting infrastructure; and follow-up work on RaISe and Usher Services.
Eddie presented progress against the 2019-20 plan, showing actual days against budget. Jim asked why it had taken 25 days to finalise the 2018-19 reports, when the budget was 5 days, and sought assurance that nothing unexpected had arisen. Eddie explained that the Review of Support Services took longer to close than anticipated but assured Jim that this was due to the
complexity of one of the contracts and that it took time to reach an agreed end-point with management.
Eddie concluded the audit activity update by stating that the overall level of assurance for the period 1 April to 16 October 2019 was satisfactory. He further noted the positive nature of assurances provided to date during the course of the year.
Eddie explained next steps in relation to the External Quality Assurance Review, scheduled for autumn 2019, to be carried out by the Head of Internal Audit of the Welsh Assembly. Eddie advised SARC members that he expected a draft report of the work to be produced in advance of the next meeting of SARC.
Eddie stated that there had been no cases of whistleblowing or fraud reported to the Internal Audit Unit this year.
Eddie notified SARC members that he attended the Inter-Parliamentary Heads of Audit Group on 3-4 October 2019 in the Isle of Man. Eddie said that the agenda included: auditing and embedding GDPR; auditing legislatures against HM Treasury’s “Corporate governance in central government departments”; internal audit management; the implementation and tracking of
audit recommendations; and internal audit software.
Derek thanked Eddie and stated that it was reassuring that the Internal Audit Unit had the staff resource and time to complete its plan of work and provide a robust level of assurance. He asked Eddie to bring it to SARC’s attention if this situation changed.
7. Audit Recommendations Schedule
SARC members considered the updated Audit Recommendations Schedule and noted that implementation of 4 recommendations awaited political developments, 3 were in progress and 6 were overdue.
There was discussion in relation to the following overdue recommendations.
Report to those charged with Governance 2017-18 – Fixed Asset Register.
Paula McClintock, Head of Finance, advised SARC members that a review of the continuing activities of the Finance Office identified that an additional accountancy post is required to carry out a Fixed Asset stocktake. Paula said that it was expected that the work will be completed 31 December 2019.
Jim Wells MLA asked if any redeployed staff could carry out the work. Paula explained that no Finance Office staff were redeployed and that the Finance Office was carrying some vacancies. Lesley Hogg, Clerk to the Assembly/Chief Executive, said that Assembly Commission salary scales made it difficult to recruit qualified accountants in a competitive market. Paula said that she had tried Interchange options without success; she is currently liaising with several recruitment agencies with a view to engaging temporary resource. Jim asked if support could be provided by the Northern Ireland Civil Service (NICS). Paula said that NICS is currently recruiting accountants as they are experiencing resource pressures in respect of qualified accountants.
Rodney Allen said that this was also the experience of the Northern Ireland Audit Office (NIAO).
Derek asked that SARC be keep abreast of progress regarding staffing however emphasised that he would like to see this recommendation implemented, particularly as it has been raised in 2 successive Reports to those Charged with Governance.
Review of Secretariat Travel – August 2018 – Overnight Accommodation
Paula said that the implementation of this recommendation was also overdue because of staffing issues. She assured SARC members that all travel and accommodation must be approved in advance, however there are inconsistencies in approach for recording purposes.
Review of the Administration of the Assembly Members Pension Scheme (NI) 2016 – AMPS Risk Register
Jim Wells MLA declared an interest as a trustee and member of the Assembly Members Pension Scheme.
Lesley Hogg and Gareth McGrath left the meeting at 2.30 pm.
Richard Stewart, Director of Corporate Services, explained that the new risk register format had been adopted by the AMPS trustees however the document was still to be finalised.
Dates for the implementation of 3 other outstanding audit recommendations were noted.
Gareth McGrath re-joined the meeting at 2.35pm
8. NIAO Report to those charged with Governance
Rodney Allen, NIAO Director, presented the final NIAO 2018-19 Report to those charged with Governance, the draft of which was considered by SARC on 18 June 2019.
Rodney confirmed that the Comptroller and Auditor General certified thefinancial statements for 2018-19 on 26 June 2019.
Rodney said that the final Report was similar to the draft that was presented to SARC on 18 June 2019. He drew SARC members’ attention to the finding regarding the Maintenance of the Fixed Asset Register, on page 7 of the Report, and emphasised the importance of this work being completed, subject to resources being available to do so.
Rodney drew SARC members’ attention to the fact that Assembly Commission management had decided to remove financial commitments on the basis that they had not entered into any non-cancellable contracts. Rodney said that NIAO was content to sign off the accounts on that basis but said that it would be important to look at this issue closely next year.
Derek said that the Report was a good result for the organisation and thanked everyone involved for their efforts.
9. Corporate Risk Register
SARC members noted the September 2019 Corporate Risk Register.
Ashleigh Mitford, Governance Officer, provided an overview of key changes since it was last considered by SARC.
Ashleigh said there were no new risks and no changes to the scoring of the existing risks. She summarised the revisions, made during the September review and explained that most of them provided clarification of wording or reflected the latest position in relation to root causes, risk responses or additional actions.
10. SARC Terms of Reference (Annual Review)
SARC members considered proposed changes to SARC’s Terms of Reference. These related to the Director of Parliamentary Services’ attendance at SARC meetings and to the appointment period of SARC members. A number of changes were also proposed in order to reduce
duplication and provide clarification.
SARC agreed the proposed amendments to its Terms of Reference and agreed that they be submitted to the Assembly Commission for approval.
Action: Submit SARC’s revised Terms of Reference to the Assembly Commission for approval – Tara Caul, Director of Legal, Governance and Research Services.
11. Stewardship Statements (at 30 September 2019)
SARC noted the contents of Stewardship Statements, completed by each Director, for the period 1 April 2019 to 30 September 2019.
Richard Stewart said that there had been no significant changes since his last Stewardship Statement and highlighted that most controls within the Corporate Services Directorate sit within the financial management area.
Derek noted that Richard had stated that a personal data incident is presently being managed under the Data Breach Management Plan.
Tara Caul and Gareth McGrath, Director of Parliamentary Services, did not have anything further to add to what was set out in their Stewardship Statements.
12. NAO Cyber Security & Information Risk checklist (October 2019)
Ashleigh Mitford presented the NAO Cyber Security & Information Risk checklist - October 2019. Ashleigh said that actions taken since January 2018, when the checklist was last completed, have resulted in an improved position. Only one question, related to IS capacity, was not allocated a green status and this was reflected in the accompanying action plan.
Ashleigh advised that, given the high level of compliance, the self-assessment will be completed, and the results presented to SMG, every two years.
Gareth McGrath left the meeting at 2.45
Derek said that it was good to see a marked reduction in the issues originally identified.
13. Fraud and Bribery Self-Assessment checklists - Action Plan Monitor
Ashleigh Mitford presented the latest position in relation to the Fraud and Bribery Self-Assessment Checklists, Bribery Risk Assessment and Action Plan. Ashleigh advised SARC members that one action was outstanding in relation to seeking the views of staff as to their level of trust and confidence in Whistleblowing Arrangements.
Derek Martin said that it was important that the outstanding action be completed within the revised timeframe.
14. Whistleblowing Policy
SARC noted Northern Ireland Assembly Commission Whistleblowing Policy, updated and agreed by SMG in June 2019, and the Investigation Procedure for Internal Disclosures.
15. Key Guidance from Department of Finance
SARC members noted key guidance that had been issued by the Department of Finance since the June 2019 SARC meeting.
Gareth McGrath re-joined the meeting at 2.50 pm.
Jim Wells MLA remarked that the Review of Members Expenses would be discussed at the Assembly Commission.
Rodney Allen noted that the Assembly Commission Secretariat had reminded the Department of Finance of the independence of the Assembly Commission when responding to its Budget 2020-23 exercise. He added that NIAO is in a similar position.
Jim asked that Paula McClintock keep SARC updated on Finance Office staff vacancies. He said that he was concerned that the difficult employment market could contribute to a very difficult situation in the event of a resumption of normal Assembly business. Rodney agreed that recruitment of finance professionals in the current market was a challenge.
17. Date of Next Meeting
The date of the next meeting is Wednesday 05 February 2020 at 2 pm.
The meeting ended at 2.55 pm.