GOVERNING BODY REPORT 1. Date of Governing Body Meeting: 2. Title of Report: 3. Key Messages: This report provides an overview of the key items of business discussed and decisions made at the audit committee meeting held on 16 th September 2016. The key items for the governing body to note are: The clinical commissioning group is on course to remain compliant with the national information governance toolkit. The audit committee approved the 2015/16 Annual Audit Letter. A partially qualified value for money conclusion was received due to the financial outlook of the clinical commissioning group. There were no fraud investigations during 2015/16. Following a joint procurement process, external auditors have been appointed with effect from 2017/18. 4. Recommendations The governing body is asked to: a) Note the key items of business discussed and decisions taken by the audit committee at its meeting on 16 th September 2016. b) Endorse the decision of the joint external audit procurement panel to award the external audit contract to Grant Thornton UK LLP. 5. Report Prepared By: Gareth James Chief Finance Officer 1
Alignment of this report to the clinical commissioning group s corporate objectives Corporate objectives Alignment of this report to objectives We will deliver financial sustainability for the health economy providing value for money for the people of West Cheshire We will improve patient safety and the quality of care we commission by reducing variation in standards of care and safeguarding vulnerable people The audit committee ensures that there are sound systems of governance in place to support delivery of financial duties. We will support people to take control of their health and wellbeing and to have greater involvement in the services we commission We will commission integrated health and social services to ensure improvements in primary and community care We will commission improved hospital services to deliver effective care and achieve NHS constitutional targets We will develop our staff, systems and processes to more effectively commission health services The audit committee ensures that there are sound systems of governance in place to support delivery of financial duties. Alignment of this report to the governing body assurance framework Risk No Risk Description Assurance / mitigation provided by this report Proposal for amendment to risk as a result of this report (revised risk description, revised mitigation or scoring) 3 Failure to embed sound systems of information governance. The audit committee report demonstrates progress on compliance with information governance requirements. N/A 2
Risk No Risk Description Assurance / mitigation provided by this report Proposal for amendment to risk as a result of this report (revised risk description, revised mitigation or scoring) 2 Failure to embed systems and processes of good governance. The audit committee ensures that the clinical commissioning group has adequate systems of governance and internal control. The report to the governing body provides assurance form both internal and external auditors. N/A 3
NHS WEST CHESHIRE CLINICAL COMMISSIONING GROUP GOVERNING BODY AUDIT COMMITTEE REPORT PURPOSE 1. The purpose of this report is to provide the governing body with an overview of the key items of business discussed and decisions made at the audit committee meeting held on 16 th September 2016. BACKGROUND 2. As a formal committee of the governing body, the purpose of the audit committee is to: a. Provide assurance to the governing body that its systems of governance, risk management and internal control are effective and are being maintained across the organisation; b. Monitor compliance with the clinical commissioning group s constitution and other principal policies, including the group s policies on conflicts of interest, whistle blowing and counter fraud arrangements; c. Advise the governing body on internal and external audit services; d. Make recommendations to the governing body in respect of: The schedules of losses and compensations; The annual financial statements; Suspension of standing orders; The Scheme of Reservation and Delegation. 3. The key issues discussed at the September 2016 audit committee are summarised in paragraphs 5 to 14. INFORMATION GOVERNANCE 4. The Head of Governance provided a verbal update to the committee and confirmed that the clinical commissioning group is on course to remain compliant with the National Information Governance Toolkit. A more detailed update will be provided to the committee in December 2016. 4
UPDATED SCHEME OF RESERVATION AND DELEGATION 5. The committee approved several minor changes to the scheme of reservation and delegation. In the main, the changes involved increases to individual approval limits to support the flow of invoice approval. Other general housekeeping changes to amend job titles and additions of new members of staff were also approved. MERSEY INTERNAL AUDIT AGENCY UPDATE AND ASSURANCE FRAMEWORK REVIEW 6. The committee received a report from Mersey Internal Audit Agency covering the following key issues: An updated 2016/17 Annual Internal Audit Plan; previously approved by the clinical commissioning group s executive team. An update on work undertaken up to the month of September 2016. The key item to note was that limited assurance has been provided following the review of arrangements in place for personal health budgets. A joint action plan is being developed with neighbouring clinical commissioning groups to address the issues raised in the review, ANTI-FRAUD ANNUAL REPORT 2015-16 7. During 2015/16 the anti-fraud service completed a wide range of work across the areas of activity outlined by NHS Protect and previously agreed in the work-plan by the audit committee. The plan has been delivered in full without changes. There were no fraud investigations in the period. 2015/16 ANNUAL AUDIT LETTER 8. The committee approved the 2015/16 Annual Audit Letter which summarised the key findings arising from the work undertaken by Grant Thornton UK LLP for the year ended 31 st March 2016. As previously reported, unqualified audit opinions were received with the exception of the value for money opinion which was partially qualified (described as an except for value for money conclusion) due to the financial outlook of the clinical commissioning group. 9. Detailed findings from the audit work were reported to the audit committee on 25 th May 2016. 5
APPOINTMENT OF EXTERNAL AUDITOR 10. Following the passing of the Local Audit and Accountability Act 2014, the current arrangements for external audit will cease in 2016/17 and clinical commissioning groups will need to make arrangements to procure their own external audit service from 2017/18. 11. Further guidance issued on the 18 th March 2016 indicated that clinical commissioning groups may work together provided that they agree the governance arrangements. The audit committee had previously agreed to undertake a joint procurement with 4 neighbouring clinical commissioning groups. 12. Following the joint procurement process, a successful bidder was chosen. A paper detailing the procurement process that was undertaken and details of the successful bidder is provided here. 13. Both the West Cheshire Clinical Commissioning Group Chief Finance Officer and the Audit Committee Chair took part in the procurement process. RECOMMENDATIONS 14. The governing body is asked to: a) Note the key items of business discussed and decisions taken at the audit committee on 16 th September 2016. b) Endorse the decision of the joint external audit procurement panel to award the external audit contract to Grant Thornton UK LLP. Gareth James Chief Finance Officer November 2016 6