Meeting of the Audit and Risk Committee
A meeting of the Audit and Risk Committee was held on Wednesday 5 June 2013 at
12:30pm in the Boardroom, The Optima, Glasgow.
1.
Apologies/welcome*
Present:
Moi Ali
Alan Armstrong
Anna Boni
Laura Burman
Morag Campsie (External Auditor)
Alasdair Craik (External Auditor)
Kate Dunlop (Chair)
Les Henderson (Internal Auditor)
Gillian Howells
Bill Maxwell
Craig Munro
Iain Nisbet
Gayle Reilly
Stuart Robinson
Apologies:
Sir Andrew Cubie
Alastair Delaney
Kenneth Muir
2.
Minute of previous meeting and action log*: 27 March 2013
Noted 1: The minute of the previous meeting was approved, subject to minor
amendment.
Noted 2: Stuart informed the Committee that the Office Services manager role had
been filled. This role will have responsibility for health and safety and
will oversee this action. Moi informed Stuart that the Scottish Ambulance
Services offered discounts on defibrillators and undertook to email Stuart
with details.
Noted 3: Laura provided the Committee with a verbal update on the Complaints
Handling procedures (CHP). She explained that the CHP has been in
place since September 2012 and that it is based on the Scottish Public
Service Ombudsman (SPSO) model. We are currently dealing with a
complaint from AHDS on issues regarding who can/can’t complain. Laura
and Ken Muir have met with Jim Martin, SPSO, to clarify the position. It
should be noted that there is not a linear relationship between us and the
SPSO, therefore all complaints are treated individually. For clarity,
exemplar case studies will be developed to link with our CHP and inform
individuals of when they can complain.
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Noted 4: Les updated the Committee on Service Level Agreements (SLAs). All
services provided by the Scottish Government will in future require a SLA.
Internal Audit will not charge current users for their service.
Action:
Change Alasdair Craik’s role to Senior Audit Manager.
3.
Matters arising*
Noted 1: No other matters arising.
4.
Declarations of interest*
Noted 1: Iain informed the Committee that he is a member of the Parent Council for
Torrance Primary School but no longer Chair.
Action:
The following actions to be taken forward:
 Update Iain’s Declarations of Interest
 Kate requested that the Scottish Government’s guidance on
declarations of interest discussed previously, be circulated to the
Committee.
Items for discussion
5.
Annual accounts 2012-13
Noted 1: Gillian provided the Committee with a summary of the main points of
interest from the 2012-13 annual accounts. She explained that there was a
delay in receiving data from the Department of Work and Pensions (DWP)
and that consequently she has been unable to finalise the accounts. It
should be noted that this is an issue across all Scottish Government bodies
and not just Education Scotland.
Noted 2: The final budget is £32.3 million, with an under spend of £2.5m.
Points to note from the discussion:
 Iain asked about the movement from the forecast in the February budget
monitoring report to the position as per the accounts. In February, it was
anticipated that we would be able to progress expenditure on IT
equipment and support. However, it was decided not to rush through
any purchases and therefore planned expenditure slipped.
 Net liability has increased this year but Alasdair confirmed that this is not
unusual for this type of agency and Les was content with this also.
There is no undue risk to the agency.
 Current liability – there are higher levels of accruals this year due to
some organisations being slow in raising invoices. The team have in the
past, chased organisations for invoices but have not been able to do so
this year due to other priorities.
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 Moi expressed her concern that the Water consumption visual is
misleading due to the scaling and gives the wrong impression. It was
noted that in order to provide accurate comparisons this should be the
first year for setting the baseline and that future data will show trending.
 The same was noted for the travel comparison. Bill is content that the
information in the draft accounts is accurate and is a true reflection of
circumstances, albeit that the remuneration data is not yet available.
 Kate noted that a future SLA would provide an opportunity to ensure that
the information from other parties is available on time.
Action:
The following actions to be taken forward:
 The sentence on page 7 to be completed.
 The text under the heading Environmental matters and social and
community issues needs to be improved.
 A couple of sentences should be to added on recruitment matters.
6.
Auditor’s report in financial statements
Noted 1: The Committee noted Audit Scotland’s draft Annual Report on the 2012-13
audit. Points to note from the discussion are below
 In the absence of the remuneration report the Annual Audit Report
requires to remain in draft.
 There are no major issues in the accounts to note.
 Good financial statement. Gillian and her team have been again very
helpful this year.
 The Annual Internal Audit Report should be produced before the
accounts and to ensure this happens in the future Les and Stuart should
review and agree a service level agreement, with an appropriate timeline
and individuals identified as accountable.
 Performance Management is ongoing but needs greater emphasis on
delivery and implementation, congruent with the finalised corporate plan.
Noted 2: Alasdair would like to extend his thanks to Stuart, Craig and all of the team.
Noted 3: Stuart wished to formally record his thanks to Gillian and her team for their
hard work in preparing the financial statements.
Noted 4: Craig reported on progress on the creation and delivery of the ICT strategy
and detailed the critical nature of the wider ambitions of Education Scotland
and the Scottish Government in terms of maximising the impact of ICT. He
identified the benefits of Glow and its impact and utility for Professional
Learning Communities (PLCs) and individual learners, and explained the
challenges involved in working with inconsistent broadband speeds etc.
Noted 5: Each strategic Director has been paired with a Non-Executive following a
suggestion at the “away day”. It was clarified that this is currently in place
for the Management Advisory Board attendees only, but after discussion, it
was agreed that further conversations should take place on areas that may
be of interest for other non-executives.
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Agreed: The remuneration information is still to be added but the Committee
agreed that the content of the report can now be sent to the
Management Advisory Board with a recommendation to accept the
accounts.
Action:
The following actions to be taken forward:
 Internal Audit should be discussed before the External Audit work
on the Audit and Risk Agenda.
7.
Internal Audit*
7.1
7.2
Report on audit activities and annual assurance paper 2012-13
Annual review of agency governance risk and financial frameworks
Noted 1: The Committee noted the reports on internal audit work undertaken within
Education Scotland in 2012/13.
Noted 2: Reasonable assurance is provided and the auditor reports that the
organisation continues to perform well given significant changes. Kate
stressed that this has been another challenging year and that the operation
was still in transition.
Noted 3: There are no fundamental concerns which require immediate attention.
However, there are some issues which require attention. There are
some good processes in place and some new processes which have still to
be fully implemented e.g. governance structure and business planning.
Risk management is still being aligned with strategic risks. The Corporate
plan will be launched in September and it is recognised that a major
engagement with key stakeholders has gone in to its creation. Internal
Audit is aware of the challenges faced by the organisation but requires to
detail the gaps it identifies. Les noted that some really good work is going
on, particularly the management of CfE and the maturation of Bill’s role.
Les commended Maureen Gore on the management of the programmes.
Noted 4: Les informed the Committee that all areas will be revisited next year to
report on progress.
Noted 5: The CfE and Glow audits provided substantial assurance. There are some
issues with links to Scottish Government objectives which will be discussed
at a later date.
Noted 6: Moi asked what role the Audit and Risk Committee play in reviewing
progress on actions identified on the Internal Audit plan. It was agreed that
progress on recommendations would be included as part of the standard
agenda items for the committee. Les is content to update the group.
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Noted 7: The high percentage of Education Scotland’s annual budget that is in-year
funding rather than baseline budget needs to be recognised as a corporate
level risk and Les will be returning to that in the coming year.
Action:
Progress report on audits to be added as a standing item at each
meeting.
8.
Corporate Risk*
Revised approach to risk management
Noted 1: Laura invited the Committee to review the revised risk management
approach and to make any further comment. The revised approach was a
draft based on discussions from the Risk Management Workshop and
previous Committee meeting, as well as the outcome of direct discussion with
the strategic directors.
Noted 2: Laura explained that the strategy and principles were reviewed before the
risk register would be drafted. There are five keys phases to the
methodology which are Clarifying, Identifying, Assessing, Addressing and
Review and Reporting.
Agreed: The Committee agreed to sign-off the risk policy and strategy. It can
now go forward for implementation.
Action:
An update on progress of implementing the risk management approach
to be added to the Agenda for the next meeting.
Items for noting
9.
Letter from Leslie Evans, DG Learning & Justice to Chief Executive,
Education Scotland
Noted 1: The letter sets out the role of the Fraser figure and was shared with the
Committee for information.
10.
Any other business*
Noted 1: Iain asked if it would be possible to receive on a monthly basis by email a
media update on both positive/negative press coverage or anything we are
involved in responding to. It was agreed that this was a positive suggestion
and that the impact of feasibility of the work would be looked at.
Noted 2: Kate asked the internal and external auditors if there were issues/risks
within other agencies or elsewhere in the “Audit and Risk” domain that we
should be made aware of; both commented that they were not aware of any
such issues. She thanked the auditors for their input and the committee for
their support and closed the meeting.
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11.
Date of next meeting*
The next meeting is scheduled to take place on Tuesday 17 September 2013 at
2.30pm, Denholm House, Livingston.
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