The Governance and Audit Committee convened to discuss internal audit progress, the committee's annual report, and the draft statements of accounts for the Welsh Church Fund, the Monmouthshire Farm School Endowment Trust Fund, and the Llanelly Hill Social Welfare Centre. The committee reviewed and provided comments on the draft statements of accounts, and also reviewed and endorsed their own annual report.

Internal Audit Progress Report

The committee reviewed the Internal Audit Progress Report for Quarter 1 (2025/26). The report assessed the internal control environment within the council based on audit reviews completed up to 30 June 2025, and the performance of the Internal Audit Section during the first three months of the financial year.

Key points from the report:

• Six audits had been completed to the draft stage, with five being opinion-related.
• One audit opinion, for the My Mates service, received an unfavourable (limited assurance) opinion.
• 35% of the agreed audit plan was started or in progress at the end of Quarter 1.
• 9% of the 2025/26 Audit Plan has been completed, slightly below the target of 10%.

The audit of My Mates, which took place between February and June 2025, aimed to assess compliance with policies, budget management, eligibility criteria, and payroll controls. The audit identified several significant weaknesses, including:

• Missing formal documentation for eligibility criteria.
• Outdated application forms.
• Insufficient grant funding.
• Delayed banking.
• Non-compliance in payroll practices.

The absence of the My Mates Manager during the audit fieldwork limited some discussions, but conclusions were drawn from available documentation. No critical risks were found, but the overall rating was Limited Assurance, indicating significant gaps requiring improvement.

The committee noted the audit opinions issued and the progress made by the Internal Audit Section towards meeting the 2025/26 Operational Audit Plan.

Governance and Audit Committee Annual Report 2024/25

The committee reviewed and endorsed the Governance and Audit Committee Annual Report 2024/25, which was presented by Andrew Blackmore, Chair of the Governance and Audit Committee. The report concluded that the committee had discharged its responsibilities during the 2024/25 period, and that the council could be reasonably assured that its overall governance, risk, and control arrangements were broadly effective.

The report noted a few specific matters:

• Concerns had been raised consistently over the extended timeline for appointing a permanent Chief Internal Auditor (CIA). The committee was pleased that this situation had been resolved following the recent successful recruitment of Jan Furtek, Chief Internal Auditor.
• The committee noted that officers did not engage with the committee when proposing recent changes to the council's constitution.

The committee agreed that officers have continued to engage constructively and in good faith with the Committee throughout the period.

The council was invited to consider the conclusion and observations set out within the Annual Report, provide feedback on the performance of the Governance and Audit Committee, and endorse the report.

Charitable Trust Funds Draft Statements of Accounts 2024/25

The committee reviewed the draft statements of accounts for the Welsh Church Fund, the Monmouthshire Farm School Endowment Trust Fund, and the Llanelly Hill Social Welfare Centre.

Welsh Church Act Fund

Monmouthshire County Council acts as lead trustee for the Welsh Church Act Fund, a charitable trust covering the council administrative areas of Blaenau Gwent, Caerphilly, Monmouthshire, Torfaen, and the City of Newport. The primary object of the trust is to assist public groups and individuals for educational, social, recreational, and other charitable benefit purposes.

Key points from the draft accounts:

• The fund increased in value by £487 during the year.
• Income was principally comprised of investment income of £219,160.
• Resources expended during the year amounted to £208,826, principally grant distribution payments of £191,153.
• Net losses on the capital value of investments held amounted to £10,107.
• The level of funds held at 31st March 2025 is £5,218,381.

Monmouthshire Farm School Endowment Trust Fund

Monmouthshire County Council acts as Trust administrator and Investment custodian for the Monmouthshire Farm School Endowment Trust Fund. The primary object of this charitable trust is to make awards to students in need of assistance to attend Usk Agricultural College (Coleg Gwent), or any other college, institution, or university to pursue courses of study in agricultural subjects.

Key points from the draft accounts:

• The Fund has increased in value by £24,331 over the financial year.
• Income consisted of interest on investments and cash held of £33,284, and £512 in respect of the annual payment from the Roger Edwards Educational Trust.
• Expenditure of £10,017 primarily comprised of grants payable of £7,474.
• An unrealised investment gain of £552 was made in relation to investments held.

Llanelly Hill Social Welfare Centre

The Llanelly Hill Social Welfare Centre is a registered charitable trust owned and run by a board of trustees and supported by Monmouthshire County Council.

Key points from the draft accounts:

• The trust has generated income of £33,309 during the year, primarily from income-generating activities at the centre.
• This included grant funding received during 2024/25 of £23,214 from the National Lottery Community Fund which has allowed for the appointment of an additional project manager to support activities at a cost £13,923 for the year.
• The income generated has covered the management and maintenance costs incurred during the year of £25,268, resulting in an overall operational gain on the fund of £8,041.

The committee reviewed the 2024/25 draft Statement of Accounts for the above bodies and provided comments or proposed amendments which will be considered alongside the external audit process and prior to the final publication.

Forward Work Plan

The committee noted the forward work plan.