The Audit Committee of Stockport Council was scheduled to consider several key reports, including the annual anti-fraud, bribery, and corruption report for 2023-24, the annual report of the Chair of the Audit Committee for the same period, and the Audit Strategy Memorandum for the council. The meeting also included a discussion on the CIPFA Revised Code of Practice for the Governance of Internal Audit in UK Local Government.

Annual Anti-Fraud, Bribery and Corruption Report 2023-24

The committee was scheduled to consider the Annual Anti-Fraud, Bribery and Corruption Report for 2023-24, presented by the Assistant Director for Finance (Interim Section 151 Officer). This report details the work undertaken during the past year to minimise the risk of fraud, bribery, and corruption within the council. It outlines key activities, processes, and findings from the previous year, as well as planned work for 2024-25 and highlights current areas of fraud risk. The report aims to demonstrate the council's commitment to managing these risks and supports the requirements of the Accounts and Audit Regulations (England) 2011, which mandate measures for the prevention and detection of inaccuracies and fraud. The report also notes that the prevention, detection, and management of fraud risks are the responsibility of all services within the council.

The report detailed various initiatives and work carried out during 2023-24, including:

• Internal Audit Investigations: Three separate investigations were supported by Internal Audit, addressing issues such as attempted payment interception, a manipulated cheque, and potential fraud within the Household Support Fund.
• National Fraud Initiative (NFI): The council's participation in the NFI data matching exercise was coordinated by Internal Audit, with a focus on reviewing high-risk alerts.
• Blue Badges: An updated process for the proactive management of blue badges was in place, involving parking enforcement and Internal Audit to detect and deter fraud and misuse. A new online reporting process had also been launched.
• Housing Stock: Stockport Homes reported on its proactive approach to tackling housing fraud and money laundering, including checks on tenancy fraud and fraudulent applications for social housing. Fraud checks were also conducted for Right to Buy/Acquire and Shared Ownership schemes.
• Insurance Claims: In-house counter-fraud checks and joint working identified and led to the repudiation of four insurance claims, with significant reserves saved.
• Council Tax – Single Persons Discount (SPD): A review of SPD caseloads by Civica, in partnership with Experian, identified changes in circumstances that could indicate additional occupants, leading to verification requests and the removal of discounts where appropriate.
• Trading Standards: The team addressed consumer complaints related to unfair trading and illegal business activity, with a focus on doorstep crime and rogue traders targeting vulnerable individuals. They also tackled the issue of illegal and incorrectly labelled vapes, implementing a streamlined legal process and conducting seizures.
• Business and Discretionary Grants: Identification and recovery efforts continued for potentially fraudulent or erroneous grant claims, with a significant amount initially identified and some returned to the Department for Business and Trade (DBT).

The report also outlined future developments and areas of risk for 2024-25, including Housing Benefit/Council Tax Support, Cyber Fraud, Procurement fraud, and various other risk areas. The conclusion stated that the council had effective measures in place during 2023-24 to prevent and detect inaccuracies and fraud, and work would continue to ensure an environment where fraud, bribery, and corruption are not tolerated.

Annual Report of the Chair of the Audit Committee - 2023-24

This report, presented by the Assistant Director for Finance (Interim Section 151 Officer) and the Chair of the Audit Committee, Councillor Sue Glithero, aimed to demonstrate how the Audit Committee fulfilled its terms of reference during the financial year 2023-24. It highlighted the committee's commitment to improving the council's governance and control environments. The report noted the appointment of a co-opted member, which broadened the committee's knowledge base. It also emphasised the vital role of the Audit Committee in the council's overall governance arrangements, with all meetings being webcast and open to the public. The report acknowledged the support from officers and members and highlighted the value of training sessions provided by Internal Audit and Finance services. The committee was noted to have been well-attended, with constructive questioning and limited areas of concern. The report concluded by stating that the Audit Committee would continue to support the organisation in delivering services to the community, particularly in light of significant challenges to governance, control, and risk management processes.

The report detailed the committee's activities across various areas, including:

• Financial Reporting: Review of accounting policies and the 2021/22 Annual Statement of Accounts.
• External Auditors: Review of the audit plan, findings, and progress reports from the external auditors, Forvis Mazars.
• Internal Audit: Review and approval of the annual risk-based internal audit plan, progress reports, and discussion of key findings and risk/control issues.
• Governance, Risk Management and Counter Fraud: Monitoring the effectiveness of the council's system of control, reviewing the corporate risk register, and overseeing the production of the Annual Governance Statement (AGS).

Plans for 2024-25 included continuing to develop the Audit Committee's role in reviewing governance issues, developing a more proactive approach to risk identification, attending risk workshops, driving up standards, reviewing governance arrangements, supporting Internal and External Audit, ensuring compliance with Public Sector Internal Auditing Standards, and helping the council manage the risk of fraud and corruption.

CIPFA – Revised Code of Practice for the Governance of Internal Audit in UK Local Government

The committee was scheduled to consider a report regarding the introduction of a Revised Code of Practice for the Governance of Internal Audit in UK Local Government by the Chartered Institute of Public Finance and Accountancy (CIPFA). This code is intended to apply to all principal authorities in UK local government and complements CIPFA's work on replacing the current Public Sector Internal Audit Standards. The code aims to ensure effective arrangements for internal audit, supporting the best use of resources and robust governance. It is designed to be the responsibility of those charged with governance within local government bodies and is expected to be effective from 1 April 2025, with CIPFA planning engagement webinars on the consultation in the autumn.

Audit Strategy Memorandum for Stockport Metropolitan Borough Council

The committee was to consider the Audit Strategy Memorandum for the year ending 31 March 2024, prepared by the external auditors, Forvis Mazars. This document outlines the audit approach, highlights significant audit risks and areas of key judgement, and details the audit team. It also summarises considerations and conclusions regarding the auditors' independence. The memorandum emphasises the importance of two-way communication between the auditors and the Audit Committee to ensure a mutual understanding of the audit scope and responsibilities. The approach is risk-based, focusing on areas of the financial statements considered more susceptible to material misstatement. The report identified significant risks, including management override of controls, valuation of the net defined benefit pension liability, valuation of land and buildings, valuation of investment properties, and the valuation of the Manchester Airport Holdings Limited (MAHL) shareholding. The planned response to these risks involved evaluating controls, challenging assumptions, and performing substantive procedures. The memorandum also detailed the audit team, the audit scope and timeline, and the approach to group audits.

The meeting was scheduled to be chaired by Councillor Jon Byrne (Chair of Audit Committee) or Sue Glithero (Chair of Audit Committee), with other attendees including Philip Mills (Co-opted Member), Carol Hargreaves, Councillor Ian Powney, Councillor Alex Wynne (Chair of the CRMG Scrutiny Committee), Councillor Carole McCann (Deputy Group Leader and Chair of the Cheadle Area Committee), and Councillor Jake Austin (Cabinet Member for Housing & Environment).