Annex A – annual governance statement guidance
The NHS TDA Chief Executive, in his capacity as the Accounting Officer for the NHS TDA, requires
NHS Trust accountable officers (AOs) to give him assurance about the stewardship of their
organisations. The governance statement records the stewardship of the organisation to supplement
the accounts. It will give a sense of how successfully it has coped with the challenges it faced and
how vulnerable performance is or might be.
This statement will draw together position statements and evidence on both corporate and quality
governance, risk management and control, to provide a more coherent and consistent reporting
mechanism.
The governance statement should be a ‘live’ document reflecting the organisation’s governance
procedures and systems. It should not be produced through a process designed solely for the annual
report and accounts.
The governance statement should refer to the board’s committee structure, changes in personnel of
executives and non-executives, the board’s performance, including its assessment of its own
effectiveness and that the required standards are achieved.
The statement should make reference to performance against the national priorities set out in the
NHS TDA Accountability framework 2014/15. This should also include an explicit statement on how
the Trust assures the quality and accuracy of elective waiting time data and the risks to the quality
and accuracy of this data.
There is no set template for the governance statement as it will be important for each organisation
to set reporting in the context of its functions and operating environment. However, in annex B to
this letter, I have set out the key elements that must be covered within the governance statement.
This is to ensure compliance with Treasury guidance and to ensure that the Department of Health’s
Principal Accounting Officer is able to draw the assurance she needs to sign an overarching NHS
governance statement.
The organisation’s external auditors will review the governance statements. They will report on:
• Inconsistencies between information reported in the statement and their knowledge of the
audited body; and
• Any failure to comply with mandatory requirements as detailed in this letter.
Annex B – key elements to be covered in the annual governance statement
Scope of responsibility
Describe the Accountable Officer responsibilities including, responsibility for maintaining a sound
system of internal control that supports the achievement of the organisation’s policies, aims and
objectives, whilst safeguarding quality standards and public funds.
Acknowledge the Accountable officer’s responsibilities as set out in the Accountable Officer
Memorandum demonstrating an understanding of propriety and accountability issues.
The governance framework of the organisation
This should include;
• Information about the board’s committee structure, its attendance records and the coverage of its
work;
• The boards performance including its assessment of its own effectiveness;
• Highlights of board committee reports, notably by the audit committees;
• An account of corporate governance, including the board’s assessment of its own Corporate
Governance. Trusts are not required to comply with the UK Corporate Governance Code. When
reporting on Corporate Governance arrangements they are advised to draw on best practice
available including those aspects of the UK Governance Code considered to be relevant to the trust
and best practice. Monitor has opted to adopt a new requirement to comply with the new UK
Corporate Governance Code for Foundation Trusts. This does not apply to NHS Trusts.
• A summary of quality governance, including arrangements for assurance on the content and
publication of the Quality Account, clinical audit, never events, SUIs and explanations of follow-up
action;
• Confirmation that arrangements in place for the discharge of statutory functions have been
checked for any irregularities, and that they are legally compliant.
Risk assessment
Describe how risk is assessed, including the organisation’s risk profile, and how it has been managed:
include
• A brief description of the organisation’s major risks, including clinical risk
• Any newly identified in-year risks and future risks ; and
• A summary of any data security breaches or lapses including the advice of the Caldicott Guardian
and any issues that were reported to the Information Commissioner.
The risk and control framework
Describe how the risk and control mechanism works including the leadership given to the process
and how staff are trained and equipped to manage risk. This should cover the key elements and why
they were chosen to deliver reasonable assurance for:
• Prevention of risks;
• Deterrent to risk arising (eg fraud deterrents); and
• Management and mitigation of risks and how outcomes are measured.
Review of the effectiveness of risk management and internal control
Give an assessment of the evidence about the effectiveness in practice of the risk management
processes in place. Include an outline of the actions taken, or proposed to deal with any significant
internal control issues or gaps in control. This should include reference to any improvement notices,
risk assessments or reports published about the organisation of internal audit and executive
managers. In doing so you should disclose any revealed deficiencies as risks have materialised.
Significant issues
You should, at least, consider these factors when determining whether an issue is significant:
• Might the issue prejudice achievement of priorities?
• Could the issue undermine the integrity or reputation of the NHS?
• What view does the Audit Committee take on this point?
• What advice has the internal or external audit given?
• Could delivery of the standards expected of the Accountable Officer be at risk?
• Has the issue made it harder to resist fraud or other misuse of resources?
• Did the issue divert resources from another significant aspect of the business?
• Could the issue have a material impact on the accounts?
• Might national or data security or integrity be put at risk?
Give full details of any significant issues including a description and an account of remedial action
taken.
The statements must be signed by the accountable officer