1.2 The Committee provides an independent review of Cumbria County Council's governance, risk management and control frameworks and oversees the financial reporting and annual governance processes.
1.3 The Committee is also responsible for overseeing internal audit and external audit, helping to ensure efficient and effective assurance arrangements are in place.
2.1 The functions of the Audit and Assurance Committee are to:
Governance, Risk and Control
(a) Review the council's corporate governance arrangements including the Annual Governance Statement against the good governance framework.
(b) Consider the council's arrangements to secure value for money and review assurances and assessments on the effectiveness of these arrangements.
(c) Consider the council's framework of assurance and ensure that it adequately addresses the risks and priorities of the council and in so doing, monitor the effective development and operation of risk management in the council.
(d) Consider reports on the effectiveness of internal controls and monitor the implementation of agreed actions.
(e) Review the assessment of fraud risks and potential harm to the council from fraud and corruption.
(f) Monitor the counter-fraud strategy, actions and resources and effectiveness of the whistleblowing arrangements.
Internal Audit
(g) Approve the internal audit charter.
(h) Approve the risk based internal audit plan, including internal audit's resource requirements, the approach to using other sources of assurance and any work required to place reliance upon these other sources.
(i) Make appropriate enquiries of both management and the head of internal audit to determine if there are any inappropriate scope or resource limitations.
(j) Consider reports from the head of internal audit on internal audit's performance during the year, including the performance of external providers of internal audit services. These will include:
(i) Updates on the work of internal audit including key findings, issues of concern and action in hand as a result of internal audit work.
(ii) Regular reports on the results of the Quality Assurance and Improvement Programme.
(iii) Reports on instances where the internal audit function does not conform to the Public Sector Internal Audit Standards and Local Government Application Note* , considering whether the non-conformance is significant enough that it must be in the Annual Governance Statement.
(iv) To receive reports outlining the action taken where the head of internal audit has concluded that management has accepted a level of risk that may be unacceptable to the authority or there are any concerns about progress with the implementation of agreed actions.
(k) Consider the head of internal audit's annual report specifically:
(i) The statement of the level of conformance with the Public Sector Internal Audit Standards and Local Government Application Note and the results of the Quality Assurance and Improvement Programme that supports the statement - these will indicate the reliability of the conclusions of internal audit.
(ii) The opinion on the overall adequacy and effectiveness of the council's framework of governance, risk management, and control together with the summary of the work supporting the opinion - these will assist the committee in reviewing the Annual Governance Statement.
(l) Consider a report on the effectiveness of internal audit to support the Annual Governance Statement.
*The Local Government Application Note is a CIPFA publication which accompanies the Public Sector Internal Audit Standards (PSIAS) and provides further detail and clarification for Local Authorities in applying the PSIAS.
External Audit
(m) Consider the external auditor's annual letter, relevant reports, and the report to those charged with governance.
(n) Consider specific reports as agreed with the external auditor.
(o) Comment on the scope and depth of external audit work and to ensure it gives value for money.
Financial Management and Reporting
(p) Review the annual statement of accounts. Specifically, to consider whether appropriate accounting policies have been followed and whether there are concerns arising from the financial statements or from the audit that need to be brought to the attention of the council.
(q) Consider proposed amendments to the Council's Financial Regulations before their adoption by the Council.
(r) Scrutinise the Treasury Management Strategy and through review gain assurance that systems of Governance and control for Treasury Management are effective.
Accountability Arrangements
(s) Report to full council on a regular basis on the committee's performance in relation to the terms of reference and the effectiveness of the committee in meeting its purpose.
(t) Liaise as necessary with Cabinet, Scrutiny and other functions to maximise the value of review work within the Council.
(u) Ensure that adequate training is provided internally and externally to enable members to fulfil their role.
