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1 JOINT INDEPENDENT AUDIT COMMITTEE - 4 SEPTEMBER 2014 JOINT INDEPENDENT AUDIT COMMITTEE ANNUAL REPORT REPORT FROM THE COMMITTEE AGENDA NO: 17(i) 1. BACKGROUND 1.1 The Joint Independent Audit Committee was formed in October 2012 prior to the elections for Police and Crime Commissioners in November The establishment of the Committee was in accordance with the requirements of The Financial Management Code of Practice for the Police Service for England and Wales as published in January In addition best practice identified in the CIPFA Guidance on Audit Committees and the HM Treasury Audit Committee Handbook were used to guide the recruitment and creation processes. Members of the public were invited to apply for a position on the Committee via a stringent but fair recruitment process. 1.2 Subsequently, five appointments were made. To ensure continuity members have been recruited for a mixture of three and five years. 1.3 Arrangements are made for the Committee to meet on a quarterly basis to receive and consider appropriate reports to effectively discharge its responsibilities as defined with the Terms of Reference, thus providing public confidence in the governance of policing in Dorset. 2. FUNCTIONS OF THE COMMITTEE 2.1 The Committee has a number of functions which include the reviewing and consideration of Financial and Treasury Management information, approval of various governance items, consideration of internal control systems, assurance relating to Corporate Risk Management, approval, reviewing and consideration of internal and external audit reports. 2.2 A full description of the functions of the Committee is attached at Appendix A. 3. COMMITTEE MEMBERSHIP 3.1 The committee comprises 5 members. Mr Colin Weston (Chairman) Mr Andrew Clarke (Vice Chairman) Mr Steve Hoskins

2 Mr Tom Grainger Mr Paul Raymond 4. ETHICS AND APPEALS SUB-COMMITTEE 4.1 Following agreement by this Committee and the Professional Standards Board, an Ethics and Appeals Sub-Committee of JIAC was established from August This Sub- Committee comprises 3 members of JIAC. 4.2 The primary purpose of the Sub-Committee was to support the Chief Constable and Commissioner through challenge and scrutiny in the delivery of a policing service that is transparent in its work and upholds the principles of good governance. 4.3 Although a Sub-Committee of JIAC, Ethics and Appeals operates independently, as such details of the Sub-Committee are not included within this report, however, the items that have been reported to the Sub-Committee are attached at Appendix B.. 5. OVERALL COMMITTEE OPINION 5.1 Throughout the year the Committee has considered a detailed programme of issues within specific areas of business, all within its agreed terms of reference and where appropriate has called for additional information or for actions to be taken. 5.2 Based on the reports provided to the Committee and subsequent discussions within our quarterly meetings, we are satisfied that sufficient internal audit work has been undertaken to allow us to draw a reasonable conclusion on the adequacy and effectiveness of the Dorset OPCC and Dorset Police arrangements. 5.3 The Committee has noted that following discussions at the quarterly meetings, Dorset Police have made significant improvements in the pursing of debts and have changed processes to prevent further debt build up. 5.4 The Committee and Dorset Police are particularly pleased to echo the benefit of the provision of independent assurance around internal processes that had often been operationally focussed. This independent focus on financial matters provides notable assurance to the Commissioner and Chief Constable. 5.5 In our opinion, based upon the work we have undertaken, for the 16 months ended 31 March 2014 the Office of the Police and Crime Commissioner and Dorset Police have adequate and effective risk management, control and governance processes to manage the achievement of its objectives. The Committee is pleased to provide reassurance to both the Commissioner and Chief Constable on that basis. 6. COMMITTEE EFFECTIVENESS 6.1 The Committee agree that there are clear, up to date terms of reference providing clarity about its role in providing reassurance to the public. Committee members have an appropriate mix of skills and experience and attend and actively contribute to discussion at meetings and feel they have access to on-going development activities to update their skills and knowledge. 6.2 With regard to the committee meetings, we are able to confirm that the papers are concise, relevant, proportionate and timely and received sufficiently far in advance of the meeting.

3 The number of meetings and access to resources is sufficient to allow the Committee to fully discharge its duties. Each meeting has a structured agenda of issues/matters for coverage, with appropriate focus given to the right areas. 6.3 Senior officers and others are in attendance at quarterly meetings to present on issues and answer questions as appropriate to assist the Committee with its deliberations. The Committee is satisfied that if necessary they would be able to hold private meetings with the external auditor and internal auditor. 7. ACKNOWLEDGEMENTS 7.1 The Committee would like to take this opportunity to thank the Chief Executive and Staff of the Office of the Police and Crime Commissioner, the Director of Finance and staff of Dorset Police and the external audit personnel for their support and assistance. Colin Weston Chairman of the Joint Independent Audit Committee Appendices Appendix A Functions of the Committee Appendix B Reports received and reviewed by the Ethics and Appeals Sub-Committee for the period August 2013 to March 2014 Appendix C Reports received and reviewed by the Joint Independent Audit Committee for the period November 2012 to March 2014

4 Appendix A FUNCTIONS OF THE COMMITTEE Financial and Treasury Management Review the Annual Statement of Accounts and seek assurance that the appropriate accounting policies have been applied Comment on the budget planning and budget setting process Consider and keep under review the Medium Term Financial Strategy Consider any policy or strategy regarding reserves Consider any policy or strategy regarding loans, investments or borrowing Consider any policy or strategy regarding asset management Consider any policy or strategy regarding fees or charges for services, sponsorship, commissioning or the giving of grants Governance Approve the Annual Governance Statement for inclusion in the Statement of Accounts Approve any Code of Corporate Governance for the Force or the PCC In conjunction with the Chief Finance Officers and the Chief Executive, undertake an annual review of the effectiveness of the Audit Committee, to include a review of the Committee s terms of reference Internal Control Consider the PCC/Force Financial Regulations, Standing Orders on Contracts and Scheme of Consent (including powers to enter into contracts and acquire or dispose of property) Keep under review the anti-fraud and anti-corruption arrangements, including whistle blowing Keep under review the effectiveness of internal control systems and seek assurance regarding such systems Commission assurance work e.g. specialist advice or audit Consider and comment upon the assurance framework Review compliance with policies relating to declarations of interest, gifts and hospitality Corporate Risk Management Consider the effectiveness of the PCC/Force risk management policy and risk management arrangements Seek assurance that organisational risks are being managed effectively Comment on and monitor the insurance programme, insurance and broker appointment/renewal processes and the arrangements for risk financing Seek assurance as to the continuing effectiveness of the PCC s and Force s business continuity arrangements

5 Internal Audit Comment on any proposals affecting the provision of the internal audit service Approve (but not direct) the annual Internal Audit Plan and monitor performance against the plan Receive and review internal audit reports and monitor the progress of implementing recommendations Consider the Annual Internal Audit Report Comment on any proposals affecting the provision of the internal audit service Keep under review the effectiveness of internal audit Seek assurance that there are effective working relationships between internal and external audit External Audit Other Comment on any proposed appointment of external auditors Consider the proposed annual audit fee Approve the External Audit Plan and monitor performance against the plan Receive and review the external auditor s reports including the annual audit letter, audit opinion etc and monitor management action in response to any issues raised Keep under review the effectiveness of external audit Seek assurance that there are effective working relationships between external and internal audit Consider any other internal or external review or inspection report that has relevance to governance and financial matters, risk management and the internal control environment. Seek assurance as to the financial effectiveness of change or continuous improvement projects/programmes, including benefits realisation. Any other duties as appropriate and agreed, eg. Police Staff Appeals if required.

6 Appendix B Reports received and reviewed by the Ethics and Appeals Sub-Committee for the period August 2013 to March 2014 Actions carried out by Committee Q Dip Sampling of Complaints files (August 2013, November 2013, March 2014) Q Dip Sampling of In House Appeals (from March 2014) Reports Received on an Annual/Quarterly Basis Q Business Interests and Gifts and Hospitality Arrangements (August 2013, November 2013, March 2014) Q Code of Conduct (August 2013, November 2013, March 2014) Reports on Reviews/Policy Political Restriction of Posts (August 2013, November 2013) College of Policing Code of Ethics (November 2013) OPCC Gifts and Hospitality Arrangements (March 2014) Code of Ethics Implementation (March 2014) Crime Data Quality Compliance (March 2014) Appeals Appeal against Dismissal (October 2013) HMIC Reports HMIC Report Without Fear or Favour (August 2013) IPCC Reports Learning the Lessons Bulletin 19: Corruption Learning the Lessons Bulletin 20: General

7 Appendix C Reports received and reviewed by the Joint Independent Audit Committee for the period November 2012 to March 2014 Reports Received on an Annual/Quarterly Basis Q - Treasury Management Q - Budget Monitoring Q - External Audit Reports from KPMG Q - Debtors Report A - Final Accounts (September 2013) A - Budget Planning Process (December 2012, December 2013) A External Audit Plan (March 2013) A - External Annual Audit Letter (December 2012, December 2013) A - Insurance Renewal Arrangements and Fund Evaluation (December 2013) Internal Audit Reports South West Audit Partnership (SWAP) Internal Audit Charter (September 2013) Internal Audit Plan (March 2013) Annual Report (September 2013) Specific Reports from SWAP Volunteers (March 2013) BACS Payments (March 2013) Key Financial Controls (March 2013) Interpreters (May 2013) Partnership Working (December 2012) Police Authority 2012/13 (December 2012) Voluntary Funds (December 2012) Agresso Financial Systems Follow Up (December 2012) Budget Monitoring (December 2012) Firearms Licensing (December 2012) Expenses and Credit Cards (May 2013) Review of Financial Management Manual (September 2013) Managing with Reduced Resources (September 2013) Olympic Funding/Spending 2012/13 (September 2013) Information Security (September 2013) Organisational Help Desk (September 2013) Change Management (September 2013) Review of Voluntary Funds for Police Welfare Fund, Social HQ Fund and Officers Mess Fund (September 2013) Professional Standards Complaint Management System (Review of Transition Document to PCC 2013/14 (September 2013) Debtors (December 2013) Road Safety (Deployment of Mobile Speed Cameras) (December 2013) Dorset Police Retirement Presentation Fund (Special Report) (December 2013) Key Financial Controls 2013/14 (March 2014) Creditors 2013/14 (March 2014) Control Accounts and Bank Reconciliation 2013/14 (March 2014)

8 Reports on Reviews/Policy Broker and Insurance Arrangements (December 2012) Budget and Precept Process (March 2013) Force Finance Instructions and Financial Management Manual (May 2013 & March 2014) Corporate Governance Framework (December 2012, March 2013 & March 2014) Annual Governance Statement (December 2013, May 2013 & December 2013) Business Continuity Arrangements (May 2013) National Audit Office Police Procurement Document (May 2013) Risk Management (Strategic) Policy and Procedure (December 2012, September 2013) Regional Procurement Strategy (September 2013) Changes to Delegations (September 2013) Dorset Emergency Services Partnership Initiative (DESPI) Contract Management Review (September 2013) National Fraud Initiative (December 2013) Single Governance Model Policy and Procedure (March 2013 & March 2014) National Audit Office Report Police Accountability: Landscape Review (March 2014) Unofficial Funds (March 2014) HMIC Reports Valuing the Police Inspection including the Dorset Police Response (September 2013 & December 2013) Value for Money Profiles 2013 (December 2013)