Agenda Document Pack - Audit, Risk and Scrutiny Board - 17/03/2025
Renfrewshire Council · 17 March 2025
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Notice of Meeting and Agenda Audit, Risk and Scrutiny Board Date Time Venue Monday, 17 March 2025 15:00 Council Chambers (Renfrewshire), Council Headquarters, Renfrewshire House, Cotton Street, Paisley, PA1 1AN MARK CONAGHAN Head of Corporate Governance Membership Councillor Andy Doig (Convener): Councillor Janis McDonald (Depute Convener): Councillor Jennifer Adam: Councillor Gillian Graham: Councillor Lisa-Marie Hughes: Councillor Robert Innes: Councillor James MacLaren: Councillor Ben Smith: Further Information This is a meeting which is open to members of the public. A copy of the agenda and reports for this meeting will be available for inspection prior to the meeting at the Customer Service Centre, Renfrewshire House, Cotton Street, Paisley and online at http://renfrewshire.cmis.uk.com/renfrewshire/CouncilandBoards.aspx For further information, please email democratic-services@renfrewshire.gov.uk Members of the Press and Public Members of the press and public wishing to attend the meeting should report to the customer service centre where they will be met and directed to the meeting. Hybrid Meeting Please note that this meeting is scheduled to be held in the Council Chambers. However, it is a hybrid meeting and arrangements have been made for members to join the meeting remotely should they wish.
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Webcasting of Meeting This meeting will be filmed for live or subsequent broadcast via the Council’s internet site – at the start of the meeting the Convener will confirm if all or part of the meeting is being filmed. To find the webcast please navigate to https://renfrewshire.public-i.tv/core/portal/home
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Apologies Apologies from members. Declarations of Interest and Transparency Statements Members are asked to declare an interest or make a transparency statement in any item(s) on the agenda and to provide a brief explanation of the nature of the interest or the transparency statement. AUDIT 1 Summary of Outstanding Internal Audit Recommendations Report by Chief Auditor. 1 - 8 2 Annual Internal Audit Plan 2025/2026 Report by Chief Auditor. 9 - 26 3 External Audit Plan 2024/25 Report by Director of Finance & Resources. 27 - 74 MONITORING & REVIEWING SERVICE DELIVERY PERFORMANCE POLICIES AND PRACTICE 4 Internal Audit Review of Compliance with the Code of Corporate Governance Report by Chief Auditor. 75 - 78 5 Annual Review of Compliance with the Local Code of Corporate Governance 2024 Report by Chief Executive. 79 - 122 6 Audit Scotland Local Government Financial Bulletin 2023/24 Report by Director of Finance & Resources. 123 - 128
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___________________________________________________________________ To: Audit, Risk and Scrutiny Board On: 17 March 2025 ___________________________________________________________________ Report by: Chief Auditor ___________________________________________________________________ Heading: Summary of Outstanding Internal Audit Recommendations ___________________________________________________________________ 1. Summary 1.1 The Chief Auditor presents this report annually to the Board to advise members of audit recommendations where agreed actions have not been effectively implemented by the date agreed. 1.2 This report, therefore, provides the updated position of those critical recommendations that have been followed up during 2024/25 and have not yet been fully implemented by service management. ___________________________________________________________________ 2. Recommendations 2.1 Members are invited to note the position with regard to these outstanding recommendations. ___________________________________________________________________ 3. Background 3.1 Internal Audit undertake an annual exercise to ensure that recommendations arising from internal audit engagements have been implemented by service management. The results of this exercise have been reported to service management on conclusion of the exercise and also to this Board as part of the Chief Auditor’s Annual Report. All critical recommendations which have been Item 1 Page 1 of 128
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made and have reached their due date for implementation, by the date of commencement of this exercise, are included in this follow up exercise and services are asked to provide evidence to demonstrate that each of these recommendations have been implemented. 3.2 The table below shows the total and status of all critical recommendations which were followed up during this exercise across Council services. 8 of these have been implemented satisfactorily. No of Critical Recommendations Service Followed Up Completed Part completed Not Yet Implemented Redundant /superseded Childrens Services 4 2 0 2 0 Finance and Resources 4 3 0 0 1 Chief Executives 4 3 1 0 0 Environment, Housing & Infrastructure 6 4 0 2 0 Environment, Housing & Infrastructure/Finance & Resources 1 1 0 0 0 Totals 19 13 1 4 1 3.3 Revised implementation dates have been provided by senior service management for those recommendations which are not yet implemented or are partially complete at the time of the internal audit review. These recommendations are detailed in Appendix 1, along with the latest response received from service management. These will be followed up again by Internal Audit during 2025/26. ___________________________________________________________________ Implications of the Report 1. Financial - None 2. HR & Organisational Development - None 3. Community Planning – Safer and Stronger - effective internal audit is an important element of good corporate governance. 4. Legal - None 5. Property/Assets - None 6. Information Technology - None Page 2 of 128
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7. Equality & Human Rights – None 8. Health & Safety – None 9. Procurement - None 10. Risk – Non implementation of critical audit recommendations results in internal control weaknesses not being addressed 11. Privacy Impact – None 12. COSLA Implications – None 13. Climate Risk – None 14. Children’s Rights - None ________________________________________________________________ Author: Karen Campbell, Interim Chief Auditor – 0141 487 0678 Page 3 of 128
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Appendix 1 Renfrewshire Council Internal Audit Service Audit, Risk and Scrutiny Board Progress of Outstanding Critical Recommendations Service Service Assignment Recommendation Original Due Date Status Management Response at Follow Up Exercise Revised Date Chief Executives Commercial and Industrial Rents Systems and resources should be put in place so that Arrears can be followed up timeously and in line with the current Rent Recovery Procedure, to issue warning letters to tenants and contact made with the tenant to attempt to agree a payment plan to recover the arrears. The processes for debt recovery should be reviewed. 01/06/24 Part Complete Efforts have been made to minimise debt. The new property assistant post will help to maintain a regular focus. Wider process with input from legal and finance colleagues to be considered as part of the Commercial property review. 31/03/25 Children’s Services Social Work Grants A checking process should be put in place to ensure the service user has acknowledged receipt of any monies/goods passed to them by their Social Worker and any receipts for goods purchased should be centrally retained at each Social Work Locality office. 30/06/24 Not Yet Implemented Work has not yet commenced on this aspect due to the notification from the Care Inspectorate of an inspection of Renfrewshire's services for children at risk of harm immediately following the publication of the internal audit report. 30/10/24 Page 4 of 128
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Service Service Assignment Recommendation Original Due Date Status Management Response at Follow Up Exercise Revised Date The inspection process continues through to the end of September 2024. Work will commence on this recommendation at that point. In the interim, an email has been issued to all managers in relation to the applying for grants, dispersal of any funds received and use of work phones to disperse funds to users of our service. Wherever possible Section 22/17 payments should be made directly to the Service User via PayPoint or BACS. In the exceptional circumstances, when this is not possible, the payment should be made from petty cash to the Social Worker and signed for by that officer at point of handover. A receipt form should also be completed and signed by the Service User when the cash is given to them. This receipt should be returned to the Office and attached to the application. 30/04/24 Not Yet Implemented This action is outstanding due to the notification of the Children at Risk of Harm Inspection at the beginning of April and the need to concentrate on this. The direction note will be issued via managers in the next 10 days. 31/08/24 Page 5 of 128
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Service Service Assignment Recommendation Original Due Date Status Management Response at Follow Up Exercise Revised Date Environment, Housing & Infrastructure Control and Recording of Assets Plant Fitters, should inform the Technical Officer when items of equipment are sent to external companies for repair and when they are returned. Inventory Removed from Establishment Forms (INV5) should be completed for repairs sent to external companies. The Fleetmaster system should be updated when items are sent for repair and when they are returned. 30/09/22 Not Yet Implemented We are in the process of rolling out the updated Fleet Management System, once in place this will be implemented. 30/06/25 Plant Fitters should inform the Technical Officer when items of equipment are uneconomical for repair. The Technical Officer should then add these to the lists of items to be disposed of at auction as they are of no further use. Inventory Deletion Forms (INV4) should be completed by the Technical Officer (as Establishment Responsible Officer) when items require to be disposed of. These should be signed by the Service Responsible Officer (and Head of Service for items valued between £1,000 and £40,000) and filed 30/09/22 Not Yet Implemented We are in the process of rolling out the updated Fleet Management System, once in place this will be implemented. 30/06/25 Page 6 of 128
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Service Service Assignment Recommendation Original Due Date Status Management Response at Follow Up Exercise Revised Date chronologically within Fleet Management. Each disposal should be authorised by the Head of Establishment. The Fleetmaster system should be updated when items are sent for disposal and the relevant Team Leader informed so that it can be removed from their records. Page 7 of 128
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___________________________________________________________________ To: Audit, Risk and Scrutiny Board On: 17 March 2025 ___________________________________________________________________ Report by: Chief Auditor ___________________________________________________________________ Heading: Annual Internal Audit Plan 2025/2026 ___________________________________________________________________ 1. Summary 1.1 In line with the requirements of the Global Internal Audit Standards in the Public Sector, a risk based internal audit plan for 2025/26 has been developed. The audit plan takes into account the outcomes of internal corporate and service risk identification and evaluation processes, and the current business environment. In addition to undertaking work which will provide assurance on the robustness of key internal controls, the plan seeks to reflect the key priorities and challenges for the council. 1.2 A number of methods have been employed to facilitate production of the risk based audit plan for 2025/26: • Consultation with all Directors and their Senior Management Teams. • Consultation with senior management from the associate bodies. • Benchmarking with other Local Authorities. • Review of strategic, corporate and service risk registers. • Cumulative audit knowledge and experience. • Review of key external audit and inspection reports. 1.3 The total available resource is 1100 days, the operational audit time available for 2025/26 has been identified as 869 days (79%). The remaining 231 days (21%) relates to training, service development, administration and management. Coverage of the plan is achieved through the use of in-house staff and where relevant, commissions from other providers. Item 2 Page 9 of 128
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1.5 Operational and non-operational time has been calculated in accordance with CIPFA benchmarking criteria. Non-operational time includes provision for training, performance management and service development. In addition to the internal audit assurance function the Interim Chief Auditor has managerial responsibility for risk management, insurance and corporate counter fraud which are excluded from the calculation of available operational audit resources. 1.6 Delivery of the risk based annual audit plan supports effective member scrutiny of the council’s internal financial and other control mechanisms. ___________________________________________________________________ 2. Recommendations 2.1 Members are asked to approve the content of the risk based audit plan for 2025/26. 2.2 Members are asked to note that the progress of the 2025/26 annual audit plan and summaries of the findings from each audit assignment will be reported to the Board on a quarterly basis. ___________________________________________________________________ Implications of the Report 1. Financial - None 2. HR & Organisational Development - None 3. Community Planning – Safer and Stronger - effective internal audit is an important element of good corporate governance. 4. Legal - None 5. Property/Assets - None 6. Information Technology - None 7. Equality & Human Rights - None 8. Health & Safety – None 9. Procurement - None 10. Risk - The subject matter of this report is the risk based Internal Audit Plan for 2025 –2026 Page 10 of 128
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11. Privacy Impact – None 12. COSLA Implications – None 13. Climate Risk – None 14. Children’s Rights - None ________________________________________________________________ Author : Karen Campbell, Interim Chief Auditor – 0141 487 0678 Page 11 of 128
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Date March 2025 Annual Internal Audit Plan 2025/26 Finance & Resources Internal Audit Page 12 of 128
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Page 3 of 14 Renfrewshire Council Annual Internal Audit Plan 2025/26 Contents Page Audit Plan Overview 4 - 9 Supporting Appendices 1 Annual Council Internal Audit Plan 2025/26 10 – 11 2 Annual Other Bodies Internal Audit Plan 2025/26 12 3 Analysis of plan by service 13 4 Annual Audit Plan 2025/26 – Integration Joint Board 14 Page 14 of 128
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Page 4 of 14 Audit Plan Overview 1. Introduction 1.1 In line with the requirements of the Global Internal Audit Standards in the Public Sector and the Internal Audit Charter, a risk based internal audit plan for 2025/26 has been developed. In formulating the audit plan a risk assessment has been undertaken, giving consideration to the following sources of information: Risk assessment (1) Risk assessment and prioritisation of all auditable activities (audit universe). (2) Strategic and Corporate Risk Register. Consultation (3) The Interim Chief Auditor has met with each member of the CMT and their senior management teams to ascertain any changes to operational practice and national policy and to determine their priorities and risks. (4) Senior Management from the Associate Bodies and One Ren have been consulted to ascertain their priorities and risks. (5) The Chief Executive has been consulted on what he sees as the council’s priority and risk areas for the forthcoming year. (6) Feedback from, and the expectations of, the Audit, Risk and Scrutiny Board are identified through the regular meetings with the members of the board. (7) The Interim Chief Auditor has met with the local External Audit team to ascertain their approach to the statutory audit where assurance on key internal controls could be provided to avoid any duplication of effort. Benchmarking (8) Other Local Authority internal audit plans. (9) Discussion with other Chief Auditors through the Scottish Local Authority Chief Auditors Group. Review of key internal reports (10) Renfrewshire’s Council Plan 2022 -2027 (11) The results of internal audit work in 2024/25 and in previous years. (12) Review of the results of the Business as Usual risk assurance modules. Review of key external reports (13) External Audit’s - Report to Members and the Controller of Audit on the 2024/25 Audit. (14) Audit Scotland: Best Value reports issued during 2024/25 (15) Review of other relevant Reports issued by External Inspection Agencies during 2024/25 . 1.2 On the basis of the above, the audit engagements planned for 2025/26 are set out in Appendix 1, 2 and 4, for the Council, Associate Bodies and the Integration Joint Board in the following categories of audit activity: • Assurance • Governance • Contingency • Planning and Reporting 1.3 It is the responsibility of management to ensure that they have good governance, risk management and internal control arrangements over the functions they are responsible for. It is internal audit’s role to provide an independent, objective assurance and consulting activity. The scope of the internal audit plan encompasses, but is not limited to, the examination and evaluation of the adequacy and effectiveness of the organisation's governance, risk management, and internal control processes; as well as the quality of performance in carrying out assigned responsibilities to achieve the organisation’s stated goals and objectives. Page 15 of 128
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Page 5 of 14 1.4 Internal Audit has authorised full, free unrestricted access to any and all of Renfrewshire Council’s records, physical properties, systems and personnel pertinent to carrying out any audit engagement. 1.5 Delivery of the internal audit plan supports the requirement for the Chief Auditor to provide an annual opinion which is used to inform the annual governance statement. 1.6 The Chief Auditor shares information and coordinates activities with other internal and external providers of assurance and consulting services, as appropriate, to ensure proper coverage and minimise duplication of effort. Internal audit may place reliance on the work of other providers of assurance and the ability to do so will be considered during each audit engagement. 1.7 The plan also includes provision for managing and developing the internal audit activity including audit planning, reporting, periodic quality assessments and for following up on previous recommendations and reactive investigative work. The plan includes contingency time to allow for completion of work carried forward from 2024/25 and provides for consultancy engagements to be undertaken where these can improve the council’s operations, add value and improve the management of risks. Contingency time also provides for sufficient flexibility to accommodate changing risks and priorities during the course of the year. More detail on each of these elements is set out in sections 4 to 7 of this plan. 1.8 The internal audit service is delivered and developed in accordance with its purpose which, as set out in the Internal Audit Charter, is to provide assurance by independently reviewing the council’s risk management, control and governance processes. 2. The current business environment and key risk areas 2.1 The audit plan detailed in Appendix 1 has been development to support the achievement of the council’s objectives and the challenges we face in achieving those objectives. The key challenges included in the planned audit work are detailed below. (1) Asset Management Effective governance and management of the council’s property assets is essential, otherwise there is a significant risk of harm to employees and citizens and financial loss, and service disruption within the Council. The 2025/26 audit plan includes time for:- • Reviewing the adequacy of the arrangements for securing our buildings including empty properties. • Conducting a compliance check on the evidence being submitted to the Housing Regulator to support the Housing Assurance Statement. • Reviewing the processes in place for obtaining vehicle road fund licences to ensure they are adequate and adhere to the regulations of the scheme. (2) Financial Challenges Our organisation continues to face a significant financial challenge to make significant savings after many years of already delivering substantial efficiencies and reduction in our spending. Alongside this, our communities are experiencing a cost-of-living crisis and the demand for our services is higher than ever before. Therefore, the financial outlook continues to be subject to significant and regular scrutiny. The 2025/26 audit plan includes time for compliance reviews of : • Non-domestic rates processes to ensure they are adequate. • The procedures in place for allocating school transport to ensure they are in line with Council guidance and, in order to ensure best value is being achieved for the Council in terms of financial and staff resource, whilst adhering to the procurement regulations. Page 16 of 128
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Page 6 of 14 • Service processes for arranging contracts for goods and services below the £24999.99 threshold. • The procuring of ICT Systems. (3) Governance Arrangements The Council governance framework ensures that its business is conducted in accordance with the law and proper standards, and that public money is safeguarded. It comprises the systems and processes, and culture and values, by which the Council is directed and controlled. These arrangements should be subject to regular review whilst undertaking transformation change programmes. During 2025/26 Internal Audit will undertake the following engagements:- • A compliance review of the Local Code of Corporate Governance to ensure there is adequate supporting evidence to support the code elements. • An operational review of the process in place for authorising transactions to ensure they are efficient and effective. (4) Fraud and Error Attempts at undertaking fraudulent activity against individuals and organisations are rapidly increasing. The Council is committed to minimising the risk of fraud and error occurring within the operation of its services by internal and external parties. . To assist in achieving this aim, it is important that that the Council review the adequacy of the internal controls in any areas where fraudulent activity has occurred in other organisations. The 2025/26 Audit Plan includes time for : • Reviewing the adequacy of the Council Tax Refund Processes. • Undertaking a Compliance Review of the key internal controls within our main financial systems. (5) Tackling Inequalities The Council plays a key role in tackling inequalities and providing the best possible services to our communities, particularly those who are experiencing the poorest outcomes. The current cost of living crisis impacts disproportionately on particular groups in society. The Council is committed to supporting people by assisting those on low incomes and increasing employment opportunities. The 2025/26 audit plan includes time for reviewing: • Scottish Welfare Fund payments to ensure the fund allocation is utilised in a fair and consistent manner. • The Employability Programme within the Council to ensure the processes in operation are adequate and meet the requirements of the funding allocation. (6) Public Protection Public protection is a wide-ranging agenda relating to the protection of vulnerable people, communities, businesses and organisations. During 2025/26, internal audit will review: • The arrangements for handling and the security of paper documentation containing personal information when working in a hybrid basis and undertaking client visits. • The procedures in place for vehicle inspections to ensure they are adequate. (7) Strategic Sustainable Planning for People and Assets Page 17 of 128
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Page 7 of 14 When major transformation is ongoing to deliver the best services possible, it is inevitable that job roles and service processes will change throughout the Council. This plan includes time for operational reviews of: • The Job Evaluation Scheme to ensure it is fit for purpose and applied in a consistent manner. • Customer Service Processes to ensure there are adequate internal controls in place and they meet customer requirements. 2.2 There are a number of significant risks, arising from the external and internal environment, which could impact on the council’s ability to achieve its objectives. The most significant risks and the risk control measures to manage these risks, are identified through the council’s corporate risk management process. Subject to the overall flexibility of the Audit Plan, priority will be given to audit engagements which impact on the council’s strategic and corporate risks. 3. Allocation of Resources 3.1 In addition to the internal audit assurance function the Chief Auditor has managerial responsibility for risk management, insurance and counter fraud which are excluded from the calculation of available operational audit resources. 3.2 The Internal Audit Service is a small team with a permanent establishment of 6 Full Time Equivalents and is considered to be appropriately resourced. It was recognised that Internal Audit teams across many councils carry resilience risks owing to their small size, composition and difficulty recruiting experienced staff. On the retiral of the Chief Auditor during 2024/25, a decision was taken to conduct a review with neighbouring councils with regards to improving resilience within internal audit and counter fraud services. This review is nearing completion and the outcomes will be reported in the near future to the Finance, Resources and Customer Services Policy Board. This post is currently being covered by the Assistant Chief Auditor on an interim basis and the team has operated with a vacant position. 3.3 Operational and non-operational time has been calculated in accordance with CIPFA benchmarking criteria. The calculation of operational staff time has been based on the permanent establishment of 6 full time equivalent employees (4 qualified and 2 non-qualified) and with a vacancy factor built into the calculation. 3.4 The vacancy is a qualified post but resources from any unfilled elements of posts and other available audit resource will be used flexibly to ensure that the audit plan commitments are met, through the engagement of temporary staff and other audit service providers where appropriate. Currently 40 days are planned to be provided from other service providers. The Interim Chief Auditor is responsible for managing the Internal Audit budget. 3.5 Non-operational time includes provision for training, performance management and service development. Where engagements are undertaken by the other audit service providers, these can provide an opportunity for benchmarking, training and development. Sufficient resources are available to engage specialist contractors where necessary to address any specific risks faced by the council. 3.6 The total available resource is 1100 days; the operational audit time available for 2025/26 has been identified as 869 days (79%). The remaining 231 days (21%) relates to training, service development, administration and management. Resources are assessed as being sufficient to provide an evidenced based opinion. 3.7 The following paragraphs provide an overview of how the audit time has been allocated to audit categories for the Council and the Associated Bodies we provide services to. A summary of the operational time by audit category is detailed in table 1 below. The analysis of non- operational audit activity is detailed in the table 2 below. The planned operational/non- operational time for 2024/25 is given for comparative purposes. Page 18 of 128
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Page 8 of 14 2024/25 2025/26 Category of audit Planned Days % of Operational Time Planned Days % of Operational Time GOVERNANCE 51 6% 76 9% ASSURANCE 374 44% 360 41% CONTINGENCY note 1 293 34% 295 34% AUDIT PLANNING / REPORTING 138 16% 138 16% TOTAL OPERATIONAL TIME 856 100% 869 100% Table 1 Notes 1. This category includes time for the finalisation of the previous year’s audits, corporate exercises and groups, investigations, significant project consultancy activities and emerging priorities. 2024/25 2025/26 Activity Planned Days % of Non - operational Time Planned Days % of Non - operational Time TRAINING 56 24% 51 22% STRATEGIC MANAGEMENT 16 7% 16 7% TEAM ADMINISTRATION 89 39% 91 39% DEVELOPMENT note 1 69 30% 73 32% TOTAL NON-OPERATIONAL TIME 230 100% 231 100% Table 2 Notes 1. This category includes time allocated to development activities to support continuous improvement activities. 4. Governance (9% of operational time) 4.1 Internal Audit must evaluate the risk exposures relating to the council’s and associate bodies governance arrangements. The engagements within this category form the basis for the Chief Auditor’s annual audit opinions and support the annual governance statements. 4.2 The results of the risk assessment are detailed at Appendix 1 and 2, Part A in respect of the current year, with a total of 76 days being allocated to these engagements for 2025/26. 5. Assurance (41% of operational time) 5.1 A risk based assessment has been undertaken of all auditable areas taking into account the risk management framework and the expectation of senior management and the Audit, Risk and Scrutiny Board. The engagements within this category also form the basis for the Chief Auditor’s annual opinions and support the annual governance statements. For each engagement internal audit will consider whether there are any available external sources of assurance that can be relied upon to deliver the plan. Time is also allocated to following up on the implementation of prior years audit recommendations. Page 19 of 128
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Page 9 of 14 5.2 The results of the risk assessment are detailed at Appendix 1 and 2, Part B in respect of the current year, with a total of 360 days being allocated to these engagements for 2025/26. 6. Contingency (34% of operational time) 6.1 This category includes time allocations for finalisation of the 2024/25 audit plan, undertaking reactive investigations of theft, fraud or other malpractice and provides for post-report work which includes attending disciplinary or appeal hearings, employment tribunals and court, as required. 6.2 The allocation of time for this category is an estimate based on prior experience and available resources. However, this will be monitored during the course of the year to ensure that internal audit continue to be in a position to respond to other priority areas which emerge during the course of the year, and, if necessary, revise the audit plan accordingly. Appendix 1 and 2, Part C details the indicative time of 295 days allocated across the contingency heading. 6.3 Should more time be available this will be added to the contingency budget and will be used to deliver audit reviews from the reserve list detailed on Appendix 1, Part E. 7. Audit Planning / Reporting (16% of operational time) 7.1 This category includes annual planning activity and reporting arrangements to the Corporate Management Team and the Audit, Risk and Scrutiny Board, the Integration Joint Board Audit, Risk and Scrutiny Board and the Boards of the other bodies we provide internal audit services to under a service level agreement. Appendix 1 and 2, Part D details the time of 138 days allocated to planning and reporting activities. 8. Analysis of Plan by Service 8.1 Appendix 3 shows the amount of operational audit time allocated to individual services in 2025/26 and compares it to the planned days for 2024/25. 8.2 The planned days allocated to all services relates to work which is cross-cutting rather than service specific as well as time which is allocated out to services as the year progresses, such as contingency and investigations. 9. Conclusion 9.1 The annual internal audit plan for 2025/26, based on the strategic risk assessment, reflects the current priorities and challenges for the council, and demonstrates that the internal audit service continues to deliver added value while continuing to improve the service in line with best practice. 9.2 The allocation of internal audit resources is sufficient to allow for flexibility to deal with emerging priorities and provide adequate coverage of governance, risk management and internal control to inform the annual assurance statement. 9.3 In order to continue to focus on areas of greatest priority or emerging risks and other unforeseen circumstances, the plan will be subject to regular review during the course of the year. The Audit, Risk and Scrutiny Board will be requested to approve any necessary changes. Interim Chief Auditor March 2025 Page 20 of 128
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Page 10 of 14 Appendix 1 Renfrewshire Council Internal Audit Annual Plan 2025/26 Entity Engagement Title Service Days Allocated Risk Category Council Plan Theme Part A – Governance 71 Corporate Governance Corporate Governance Framework Corporate - All Services 6 N/A Living Our Values Information Governance Security of Paper Documentation Adult Services 20 Strategic/BAU Fair Authorisation Controls Authorisation Controls Review Corporate – All Services 25 Strategic/BAU Living Our Values Policies & Procedures Job Evaluation Corporate – All Services 20 Strategic Fair Part B – Assurance 277 Follow Up Follow Up Corporate - All Services 39 N/A N/A Procurement Purchase of ICT Systems Corporate – All Services 20 Strategic/BAU Living Our Values Procurement Procurement Processes Corporate – All Services 20 Strategic/BAU Living Our Values Regeneration & Investment Employability Partnerships Chief Executive’s 20 Strategic Place Education Support Services School Transport Children’s Services 20 Living Our Values Building Security General Security including Empty Buildings Environment, Housing & Infrastructure 20 Strategic Place Transportation & Fleet Vehicle Testing Processes Environment, Housing & Infrastructure 20 Service Living Our Values Transportation & Fleet Roads Fund Licence Renewal Environment, Housing & Infrastructure 20 Service Living Our Values Housing Assurance Statement Housing Assurance Statement Environment, Housing & Infrastructure 8 Place Customer Services Customer Services Operations Finance & Resources 20 N/A Living Our Values Scottish Welfare Fund Scottish Welfare Fund Finance & Resources 20 Strategic Fair Council Tax Council Tax Refunds Finance & Resources 15 Strategic Living Our Values Internal Compliance Main Financial Systems – Key Controls Finance & Resources 20 BAU Living Our Values Non-Domestic Rates Non-Domestic Rates Finance & Resources 15 N/A Part C – Contingency 288 Contingency Contingency Corporate - All Services 116 Page 21 of 128
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Page 11 of 14 Entity Engagement Title Service Days Allocated Risk Category Council Plan Theme Contingency Corporate Groups Corporate - All Services 27 Contingency Investigations Corporate - All Services 145 Part D – Planning & Reporting 115 Planning & Reporting Planning & Reporting Corporate - All Services 115 Part E – Prioritised Reserve List 120 Regeneration & Investment Levelling Up Fund Chief Executive’s 20 Strategic Place Business Continuity Schools Digital Readiness Children’s Services 20 Service Fair Pupil Registration System SEEMIS Children’s Services 20 N/A Living Our Values Parking Charges & Penalties Parking Income Processes Environment, Housing & Infrastructure 20 Strategic Living Our Values Homeless Services Homeless Service Processes Environment, Housing & Infrastructure 20 Strategic Living Our Values Common Good Fund Common Good Fund Governance Finance & Resources 15 N/A Living Our Values Page 22 of 128
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Page 12 of 14 Appendix 2 Other Bodies Internal Audit Annual Plan 2025/26 Entity Engagement Title Service Days Allocated Part A – Governance 5 Integration Joint Board – Governance Arrangements Corporate Governance Framework Integration Joint Board 5 Part B – Assurance 83 SE – Other Systems Delivering Value Scotland Excel 20 OneRen – Other Systems Spot Checks / Regularity Checks OneRen 15 OneRen – Other Systems Debt Management Arrangements OneRen 8 IJB – Strategic Planning Review of Strategic Plan Process Integration Joint Board 20 RVJB – Valuation System Purchasing Processes RVJB 20 Part C – Contingency 7 Contingency Contingency All Associate Bodies 7 Part D – Planning & Reporting 23 Planning & Reporting Planning & Reporting All Associate Bodies 23 Page 23 of 128
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Page 13 of 14 2024/25 2025/26 Service Planned Days % of Operation al Time Planned Days % of Operational Time All Services note 1 465 54% 535 62% Chief Executive’s Service 20 2% 20 2% Finance & Resources 100 12% 90 10% Children’s Services 60 7% 20 2% Adult Services 20 2% 20 2% Environment, Housing & Infrastructure 73 9% 68 8% COUNCIL TOTAL 738 86% 753 87% Scotland Excel 25 3% 25 3% Clydeplan 2 0% 0 0% Renfrewshire Valuation Joint Board 25 3% 25 3% Renfrewshire Health & Social Care Integration Joint Board (Appendix 4) 40 5% 40 4% OneRen 26 3% 26 3% TOTAL 856 100% 869 100% Notes 1 Planned time includes, Follow up Audit, Contingency, Planning and Reporting and an element of Cross cutting Assurance and Governance Audits and is allocated against services during the course of the year Appendix 3 Analysis by Service Page 24 of 128
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Page 14 of 14 Audit Category Engagement Title No. of days Detailed work Governance Local Code of Corporate Governance 5 Annual review of the adequacy and compliance with the Local Code of Corporate Governance to inform the governance statement. Assurance Strategic Planning 20 The purpose of the audit is to provide assurance over the arrangements in place for updating the Strategic Plan. This key document is also utilised to evidence actions taken or planned to mitigate several risks recorded in the IJB’s Risk Register. Planning & Reporting Annual Plan, Annual Report and Audit Committee annual assessment, reporting & Training 12 The Chief Internal Auditor is required to prepare an annual plan and annual report for the Audit Committee, summarising the work undertaken by Internal Audit during the year and using this to form an opinion on the adequacy of the control environment of the IJB. Time is also available to assist in the annual assessment against the CIPFA position statement on Audit Committees. Contingency Ad-hoc advice and Consultancy 3 Time for advice and consultancy on relevant priorities and risks or change related projects and following up on the implementation of internal audit recommendations. Appendix 4 Annual Audit Plan 2025/26 – Integration Joint Board Page 25 of 128
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___________________________________________________________________ To: Audit, Risk and Scrutiny Board On: 17 March 2025 ___________________________________________________________________ Report by: Director of Finance and Resources ___________________________________________________________________ Heading: External Audit Plan 2024/25 ___________________________________________________________________ 1. Background 1.1 The Council’s appointed external auditor, Azets, has submitted an Audit Plan that outlines its approach to the audit of the 2024/25 annual accounts of the Council and the Coats Observatory Trust. The audit will assess whether the accounts provide a true and fair view of the Council and Trust’s financial positions and also whether they have been prepared in accordance with proper accounting practice, i.e. the 2022 Code of Practice on Local Authority Accounting in the UK. 1.2 The Audit Plan also outlines the responsibilities of the Council and of Azets; its assessment of key challenges and risks and the approach and timetable for completion of the audit. 1.3 The statutory deadline for the approval of the audited accounts for 2024/25 is 30 September 2025 and the annual audit report is planned to be reported to the Audit, Risk and Scrutiny Board at its meeting on 22 September 2025. 1.4 On page 31 of the Audit Plan, the proposed audit fee is detailed. For the Council, this is indicated at £478,870 for the 2024/25 audit, and represents an increase of 2% above the previous year audit fee. 1.5 The expected audit fee is reviewed by Audit Scotland each year. The 2024/25 expected audit fee is based on applying a 1.9% increase to the 2023/24 fee. This increase is applied on a sector basis and reflects the conditions of the public sector market. Item 3 Page 27 of 128
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1.6 On page 32 of the Audit Plan, the proposed audit fee for the Coats Observatory Trust for 2024/25 is indicated at £6,480 which also represents 1.9% increase in line with Audit Scotland’s approach. ___________________________________________________________________ 2. Recommendations 2.1 Members are asked to note the content of the attached report, including the proposed audit fees for the Council and the Coats Observatory Trust. _________________________________________________________ Page 28 of 128
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Implications of the Report 1. Financial – An unqualified audit opinion demonstrates that the Council has effective systems of internal control in place. The audit fee is set by Audit Scotland, with some discretion afforded to local audit teams. The proposed audit fee for the Council for 2024/25 is £478,870 and for the Coats Observatory Trust it is £6,480. 2. HR & Organisational Development – None arising directly from this report. 3. Community Planning – None arising directly from this report. 4. Legal – An audit opinion free from qualification demonstrates compliance with the statutory accounting requirements set out in the Local Government (Scotland) Act 1973. 5. Property/Assets – None arising directly from this report. 6. Information Technology – None arising directly from this report. 7. Equality & Human Rights - None arising directly from this report. 8. Health & Safety – None arising directly from this report. 9. Procurement – None arising directly from this report. 10. Risk – the audit plan highlights audit issues and risks, and the approach that Azets will adopt in seeking assurance that these risks are being managed. 11. Privacy Impact – None arising directly from this report. 12. COSLA Policy position – None arising directly from this report. 13. Climate Risk – None arising directly from this report. ________________________________________________________ Author: Christine McCourt, Head of Finance and Procurement Page 29 of 128
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Renfrewshire Council External Audit Annual Plan 2024/25 To the Members of Renfrewshire Council and the Controller of Audit March 2025 Page 30 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 2 Table of Contents Table of Contents 2 Introduction 3 Audit scope and general approach 5 Financial statements – significant audit risks 17 The wider scope of public audit 24 Renfrewshire Trust Funds 27 Audit fee 31 Audit independence and objectivity 33 Appendices 34 Page 31 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 3 Introduction This audit plan highlights the key elements of our proposed audit strategy and provides an overview for those charged with governance of the planned scope and timing of the statutory external audit of Renfrewshire Council (“the Council”), including the charitable trust administered by the Council for the year ended 31 March 2025. Our audit work will cover: x an audit of the financial statements of the Council and its Group and charitable trust and an opinion on whether they give a true and fair view and are free from material misstatement; x audit opinions on other statutory information published with the financial statements in the annual accounts, including the Performance Report, the Annual Governance Statement, and the Remuneration Report; x consideration of arrangements in relation to wider scope areas: financial management; financial sustainability; vision, leadership and governance; and use of resources to improve outcomes; x the audit of Best Value arrangements, including supporting the Controller of Audit in preparing a report on the Council’s overall Best Value arrangements and a separate Thematic Review on Best Value – Transformation in councils; x the audit of the Council’s Housing Benefit Subsidy Claim, Non-Domestic Rates Return and where relevant, the Whole of Government Accounts (WGA) return; x review of the Council’s arrangements for preparing and publishing statutory performance information; x follow up work on the section 102 report by the Accounts Commission on the school accommodation for Dargavel village; and x any other work requested by Audit Scotland. Responsibilities of the auditor and the Council The Code of Audit Practice outlines the responsibilities of external auditors appointed by the Accounts Commission and it is a condition of our appointment that we follow it. Auditor responsibilities are derived from statute, International Standards on Auditing (UK) and the Ethical Standard for auditors, other professional requirements and best practice, the Code of Audit Practice and guidance from Audit Scotland. Page 32 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 4 The Council has primary responsibility for ensuring the proper financial stewardship of public funds. This includes preparing annual accounts that are in accordance with proper accounting practices. The Council is also responsible for compliance with legislation and putting arrangements in place for governance and propriety that enable it to successfully deliver its objectives. Appendix 1 provides further detail of both our responsibilities and those of the Council. Adding value through the audit All of our clients demand of us a positive contribution to meeting their ever-changing business needs. Our aim is to add value to the Council through our external audit work by being constructive and forward looking, by identifying areas of improvement and by recommending and encouraging good practice. In this way, we aim to help the Council promote improved standards of governance, better management and decision making and more effective use of resources. Feedback If there are any elements of this audit plan to which you do not agree or you would like to discuss, please let us know as soon as possible. Any comments you may have on the service we provide, the quality of our work, and our reports would be greatly appreciated at any time. Comments can be reported directly to any member of your audit team. This plan has been prepared for the sole use of those charged with governance and management and should not be relied upon by third parties. No responsibility is assumed by Azets Audit Services to third parties. Openness and transparency This report will be published on Audit Scotland’s website www.audit-scotland.gov.uk. Page 33 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 5 Audit scope and general approach Our objective when performing an audit is to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement and to issue an auditor’s report that includes our auditor’s opinion. As part of our risk-based audit approach, we will: x Perform risk assessment procedures including updating our understanding of the Council, including its environment, the financial reporting framework and its system of internal control. x Review the design and implementation of key internal controls. x Identify and assess the risks of material misstatement, whether due to fraud or error, at the financial statement level and the assertion level for classes of transaction, account balances and disclosures. x Design and perform audit procedures responsive to those risks, to obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. x Exercise professional judgment and maintain professional scepticism throughout the audit recognising that circumstances may exist that cause the financial statements to be materially misstated. We will undertake a variety of audit procedures designed to provide us with sufficient evidence to give us reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. We include an explanation in the auditor’s report of the extent to which the audit was capable of detecting irregularities, including fraud and respective responsibilities for prevention and detection of fraud. Page 34 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 6 Planning is a continuous process and our audit plans are updated during the course of our audit to take account of developments as they arise. Communication with those charged with governance Auditing standards require us to make certain communications throughout the audit to those charged with governance. For the purposes of this audit, we have designated the Audit, Risk and Scrutiny Board as those charged who will receive and consider all key audit outputs. In addition, our Annual Audit Report and Best Value reports will be presented to full Council. Professional standards and guidance We perform our audit of the financial statements in accordance with International Standards on Auditing UK (ISAs (UK)), Ethical Standards, and applicable Practice Notes and other guidance issued by the Financial Reporting Council (FRC). Partnership working We coordinate our work with Audit Scotland, internal audit, other external auditors and relevant scrutiny bodies, recognising the increasing integration of service delivery and partnership working within the public sector. Our Audit Scotland appointments include Renfrewshire Council, Renfrewshire Valuation Joint Board, Scotland Excel, Clydeplan and the Coats Observatory Trust. Azets Audit Services is separately appointed as external auditors of Renfrewshire Leisure Limited (OneRen). Where practicable and appropriate we will share knowledge to generate efficiencies in the delivery of our audits. Audit Scotland Although we are independent of Audit Scotland and are responsible for forming our own views and opinions, we do work closely with Audit Scotland throughout the audit. This helps identify common priorities and risks, treat issues consistently across the sector, and improve audit quality and efficiency. We share information about identified risks, good practices and barriers to improvement so that lessons to be learnt and knowledge of what works can be disseminated to all relevant bodies. Audit Scotland undertakes national performance audits on issues affecting the public sector. We may review the Council’s arrangements for taking action on any issues reported in the national performance reports which may have a local impact. We also consider the extent to which the Council uses the national performance reports as a means to help improve performance at the local level. During the year we may also be required to provide information to Audit Scotland to support the national performance audits. Page 35 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 7 Shared risk assessment and joint scrutiny planning The Shared Risk Assessment (SRA) process is a vehicle for scrutiny bodies to share intelligence and agree scrutiny risks at councils. A local area network (LAN) has been established for each council in Scotland which comprises representatives from the main local government scrutiny bodies. The LAN is led by external audit and meet as and when is considered appropriate. Internal Audit As part of our audit, we consider the scope and nature of internal audit work and look to minimise duplication of effort, to ensure the total audit resource to the Council is used as efficiently and effectively as possible. Delivering the audit Hybrid audit approach We intend to adopt a hybrid approach to our audit which combines on-site visits with remote working; learning from the better practices developed during the pandemic. Secure sharing of information We use a cloud-based file sharing service that enables users to easily and securely exchange documents and provides a single repository for audit evidence. Regular contact During the ‘fieldwork’ phases of our audit, we will arrange regular catch-ups with key personnel to discuss the progress of the audit. The frequency of these meetings will be discussed and agreed with management. Signing annual accounts Audit Scotland recommends the electronic signing of annual accounts and uses a system called DocuSign. Electronic signatures simplify the process of signing the accounts. Accounts can be signed using any device from any location and there is no longer a need for duplicate copies to be signed. Materiality We apply the concept of materiality both in planning and performing the audit, and in evaluating the effect of identified misstatements on the audit and of uncorrected misstatements. Judgments about materiality are made in the light of surrounding circumstances and are affected by our perception of the financial information needs of users of the financial statements, and by the size or nature of a misstatement, or a combination of both. Page 36 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 8 Planning Materiality: We have set our materiality at 2% of gross expenditure based on the audited financial statements for 2023/24, resulting in £17.90million for the Group and £17.80million for the Council accounts. Performance Materiality: Using our professional judgement, we have assessed performance materiality at 75% of planning materiality, resulting in £13.43million for the Group and £13.35million for the Council accounts. Specific Materiality: In performing our audit, we apply a lower level of materiality of £5,000 to the audit of the Remuneration Report: senior officer and councillor remuneration tables. Trivial threshold: We are required to report to those charged with governance on all unadjusted misstatements more than the ‘reporting threshold' amount. We have set this at approximately 5% of planning materiality, resulting in £0.895million for the Group and £0.890million for the Council accounts. When planning, we make judgements about the size of misstatements which we consider to be material, and which provide a basis for determining the nature and extent of our audit procedures. Materiality is revised as our audit progresses, should we become aware of any information that would have caused us to determine a different amount had we known about it during our planning. The basis for our assessment of materiality is set out in Appendix 2. Accounting systems and internal controls The purpose of an audit is to express an opinion on the financial statements. As part of our work, we consider certain internal controls relevant to the preparation of the financial statements such that we are able to design appropriate audit procedures. However, this work is not for the purpose of expressing an opinion on the effectiveness of internal controls. We will report to the Council, significant deficiencies in internal controls that we identify during the audit. These matters will be limited to those which we conclude are of sufficient importance to merit being reported. The scope of our work is not designed to be an extensive review of all internal controls. Specialised skill or knowledge required to complete the audit procedures Our intended audit approach is to consult internally with our Technology Risk team for them to support the audit team in assessing the information technology general controls (ITGC). Page 37 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 9 Going Concern In most public sector entities (including local government pension schemes), the financial reporting framework envisages that the going concern basis for accounting will apply where the entity's services will continue to be delivered by the public sector. In such cases, a material uncertainty related to going concern is unlikely to exist. For many public sector entities, the financial sustainability of the entity is more likely to be of significant public interest than the application of the going concern basis. Our wider scope audit work considers the financial sustainability of the Council. Management responsibility Management is required to make and document an assessment of whether the Funds are a going concern when preparing the financial statements. The review period should cover at least 12 months from the date of approval of the financial statements. Management is also required to make balanced, proportionate and clear disclosures about going concern within the financial statements where material uncertainties exist in order to give a true and fair view. Auditor responsibility Under ISA (UK) 570, we are required to consider the appropriateness of management’s use of the going concern assumption in the preparation of the financial statements and consider whether there are material uncertainties about the Funds’ ability to continue as a going concern that need to be disclosed in the financial statements. In assessing going concern, we will consider Practice Note 10 (PN10) and Code of Practice on Local Authority Accounting in the UK, which focuses on the anticipated future provision of services in the public sector rather than the future existence of the entity itself. Group audit scope and risk assessment As Group auditor, under ISA (UK) 600 (Revised September 2022) we are required to obtain sufficient appropriate audit evidence regarding the financial information of the components and the consolidation process to express an opinion on whether the group financial statements are prepared, in all material respects, in accordance with the applicable financial reporting framework. The auditing standard for group engagements has been revised, as a result of the key changes that are reflected in the audit plan are: x Revisions to the definitions of a group and component extend the scope of the ISA to encompass a wider range of group scenarios. This means that a single legal entity could fall under the scope of the group’s ISA based on its internal Page 38 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 10 structure, while multiple legal entities may sometimes be defined as a single component. x There is increased leadership responsibilities and involvement requirements for the group engagement leader, particularly when component auditors are utilised. x There is a specific requirement for all component auditors to confirm their ability and willingness to comply with the FRC’s Ethical Standard. x The analytical/desktop review designation has been removed from the scope of procedures performed over a component in response to risk. Group audit scope Based on the initial assessment the Group consists of the following entities: Component Nature and extent of further audit procedures Level of response required Renfrewhire Council Full Scope Full scope statutory audit, as set out in this audit plan. Renfrewshire Leisure Ltd Specific procedures Specific procedures in relation to pension asset/liability. Common Good Funds None No procedures planned. Paisley Museum Reimagined Ltd None No procedures planned. Park Lane Developments (Renfrewshire) LLP None No procedures planned. Coats Observatory Trust None No procedures planned. (*) Strathclyde Partnership for Transport Specific procedures Specific procedure planned in relation to investment value reflected in council’s accounts. Strathclyde Concessionary Travel Scheme Joint Committee None No procedures planned. Renfrewshire Valuation Joint Board None No procedures planned. (*) Page 39 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 11 Renfrewshire Health and Social Care Integration Joint Board Specific procedures Specific procedures on investment in associates and JV. AMIDS Renfrewshire LLP None No procedures planned. (*) We perform separate statutory audits of these accounts which are not related to the group accounts audit. Definitions: Full Scope Design and perform further audit procedures on the entire financial information of the component, beyond procedures completed to review the consolidation. Specific Scope Design and perform further audit procedures on one or more classes of transactions, account balances or disclosures, beyond procedures completed to review the consolidation. None No further audit procedures required, beyond procedures completed to review the consolidation. Risks at the component-level The risks identified at the Council are set out in this external audit plan. There are no other significant risks identified in any of the other components above in respect of the Group audit. Note that a component may require a statutory audit under UK or overseas company law irrespective of whether an audit is required for group reporting purposed. Management should therefore satisfy themselves that all UK and overseas company law requirements are adhered to on a company-by-company basis. Prevention and detection of fraud or error In order to discharge our responsibilities regarding fraud and irregularity we require any fraud or irregularity issues to be reported to us as they arise. In particular, we require to be notified of all frauds which: x involve the misappropriation of theft of assets or cash which are facilitated by weaknesses in internal control; x are over £5,000. We also require a historic record of instances of fraud or irregularity to be maintained and a summary to be made available to us after each year end. Page 40 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 12 National Fraud Initiative The National Fraud Initiative (NFI) in Scotland is a biennial counter-fraud exercise led by Audit Scotland and overseen by the Public Sector Fraud Authority for the UK. It uses technology to compare information held by different public bodies, and on different financial systems that might suggest the existence of fraud or error. Participating bodies were expected to submit datasets for matching in October 2024 and November 2024 and to receive matches for investigation in December 2024 and January 2025. We will monitor the Council’s participation and progress and, where appropriate, include references to NFI in our 2024/25 Annual Audit Report. Anti-money laundering We require the Council to notify us on a timely basis of any suspected instances of money laundering so that we can inform Audit Scotland who will determine the necessary course of action. Correspondence People or organisations write to Audit Scotland because they have concerns about an issue within a public body that falls under the remit of the Auditor General or the Accounts Commission. An issue of concern may be something such as a breakdown in financial management or governance arrangements. The key factor in determining whether Audit Scotland examines an issue is the relevance of the issue to Audit Scotland’s role and functions. Audit Scotland and appointed auditors will make this judgement using their professional and technical knowledge. Wider audit scope work The special accountabilities that attach to the conduct of public business, and the use of public money, mean that public sector audits must be planned and undertaken from a wider perspective than in the private sector. This means providing assurance, not only on the financial statements, but providing audit judgements and conclusions on the appropriateness, effectiveness and impact of corporate governance and performance management arrangements and financial sustainability. Appendix 1 provides detail of the wider scope areas of public sector audit work. Our initial risk assessment and scope of work planned for 2024/25 is outlined in the ‘Wider Scope’ section of this plan. Page 41 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 13 National risk assessment Where particular areas of national or sectoral risk have been identified by the Auditor General, they will request auditors to consider and report on those risks as they apply at a local level. For 2024/25 no such risks have been specified. Nevertheless, the arrangements for responding to climate change continues to be an area of particular focus. Climate change In 2022/23 we were required to gather information on the Council’s response to climate change. Audit Scotland has reviewed the auditor returns assessing climate change and will share the findings from the review with auditors to provide helpful background information for 2024/25 annual audit work. In addition, Audit Scotland will: x Publish a Good Practice Note on disclosures related to climate change following a review of public bodies’ 2022/23 and 2023/24 annual accounts. x Provide guidance to auditors on auditing climate change disclosures within the 2024/25 annual accounts of public bodies. Best Value Appointed auditors have a duty to be satisfied that local government bodies have made proper arrangements to secure best value. Under the Code of Audit Practice, the audit of Best Value in councils is fully integrated within the annual audit work performed by appointed auditors. We are required to evaluate and report on the performance of councils in meeting their Best Value duties. There are five aspects to our work: 1. Follow up: our work will follow up on Accounts Commission findings, Controller of Audit recommendations and any outstanding improvement actions reported in Best Value Assurance Reports, Best Value thematic reports and Annual Audit Reports. Our work will reflect the Council’s self-assessment against outstanding improvement actions and our findings will be based on the Council’s current arrangements for delivering best value. 2. Risk based approach to Best Value themes: We pay due regard to the Council’s arrangements in respect of the seven Best Value themes in identifying any significant risks. 3. Assessing the effectiveness of performance reporting: the best value theme, effective use of resources, includes an expectation that councils report effectively on their performance. Councils should be able to demonstrate a trend of improvement over time in delivering their strategic priorities. Specifically in respect of assessing the effectiveness of performance reporting we will consider: Page 42 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 14 Reporting service performance x the Council’s assessment of progress against its service priority measures in 2024/25 and over time x what the Council is reporting on its relative performance in 2024/25 and over time (from the Local Government Benchmarking Framework and other information used locally) x the effectiveness of Council processes for reporting and scrutiny of performance against its priorities Continuous improvement x the Council’s arrangements to demonstrate continuous improvement in how they deliver their priority services Statutory performance information The Accounts Commission has a statutory responsibility to define the performance information that councils must publish. This responsibility links with the Commission's Best Value audit responsibilities. In turn, councils have their own responsibilities, under their Best Value duty, to report performance to the public. The Accounts Commission issued a new Statutory Performance Information Direction in December 2021 (applies for the three years to 2024/25) which requires a council to report its: x Performance in improving local public services (including those provided with its partners and communities), and progress against agreed desired outcomes (SPI 1). The Commission expects this reporting to allow comparison both over time and with other similar bodies (drawing on the Local Government Benchmarking Framework and / or other benchmarking activities) x Own assessment and audit, scrutiny and inspection body assessments of how it is performing against its duty of Best Value, and how it has responded to these assessments (SPI 2). As external auditors we are required to satisfy ourselves that the Council has made proper arrangements for preparing and publishing the statutory performance information in accordance with the Direction. We will evaluate the effectiveness and appropriateness of the arrangements at the Council, including assessing the appropriateness of the information provided to members in responding to the Direction. 4. Thematic reviews: we are required to report on Best Value or related themes prescribed by the Accounts Commission. The thematic work for 2024/25 is on the service transformation and will involve auditors considering how councils are planning, overseeing and executing various transformation programmes and activities. We will report our conclusions in a separate report which will be Page 43 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 15 presented to those charged with governance and published on Audit Scotland’s website. 5. Contributing to Controller of Audit reports: The Controller of Audit reports to the Accounts Commission on each council’s performance in meeting its Best Value duties at least once over the five year audit appointment. The report is a summary of information and judgements reported by each auditor. When considering the s102 report on Dargavel school provision the Accounts Commission has also requested to bring forward Renfrewshire Council’s Best Value report from 2027 to 2025. As a result we will perform this work during 2024/25 and plan to report the outcomes from our review of the Council’s Best Value arrangements by end June 2025. Section102 School accommodation for Dargavel Village - Follow Up Review In January 2024 the Accounts Commission (“the Commission”) considered the S102 report by the Controller of Audit on School Accommodation for Dargavel Village. The follow-up was considered by the Commission in August 2024. On request of the Controller of Audit we will further consider impact of the above matters and comment on wider arrangements in the areas of community engagement and council culture during the 2024/25 audit. Reporting our findings At the conclusion of the audit we will issue: x an independent auditor’s report setting out our formal audit opinions within the annual accounts; and x an annual audit report describing our audit findings, conclusions on key audit risks, judgements on the pace and depth of improvement on our audit of wider scope and best value areas and any recommendations. Page 44 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 16 There is a fundamental absence or failure of arrangements in place There is no evidence to support improvement Substantial unmitigated risks affect achievement of corporate objectives Arrangements are inadequate or ineffective Pace and depth of improvement is slow Significant unmitigated risks affect achievement of corporate objectives No major weaknesses in arrangements but scope for improvement exists Pace and depth of improvement are adequate Risks exist to achievement of operational objectives Effective and appropriate arrangements are in place Pace and depth of improvement are effective Risks to achievement of objectives are managed Page 45 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 17 Financial statements – significant audit risks Significant risks are risks that require special audit consideration and include identified risks of material misstatement that: x our risk assessment procedures have identified as being close to the upper range of the spectrum of inherent risk due to their nature and a combination of the likelihood and potential magnitude of misstatement; or x are required to be treated as significant risks due to requirements of ISAs (UK), for example in relation to management override of internal controls. Significant risks at the financial statement level The table below summarises the significant risks of material misstatement identified at the financial statement level. These risks are considered to have a pervasive impact on the financial statements as a whole and potentially affect many assertions for classes of transaction, account balances and disclosures. Identified risk of material misstatement Audit approach Management override of controls (the Council and the Group) Management is in a unique position to perpetrate fraud because of their ability to manipulate accounting records and prepare fraudulent financial statements by overriding controls that otherwise appear to be operating effectively. Although the level of risk of management override of controls will vary from entity to entity, the risk is nevertheless present in all entities. Due to the unpredictable way in which such override could occur, there is a significant risk of material misstatement due to fraud in relation to estimates & significant judgements, manual journals and one-off transactions Procedures performed to mitigate risks of material misstatement in this area will include: x Documenting our understanding of the journals posting process and evaluating the design effectiveness of management controls over journals. x Analysing the journals listing and determining criteria for selecting high risk and / or unusual journals. x Testing high risk and / or unusual journals posted during the year and after the unaudited annual accounts stage back to supporting documentation for appropriateness, corroboration and to ensure Page 46 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 18 Identified risk of material misstatement Audit approach outside the ordinary course of the business. Risk of material misstatement: Very High approval has been undertaken in line with the Council’s journals policy. x Gaining an understanding of the accounting estimates and critical judgements made by management. We will challenge assumptions and consider the reasonableness and indicators of bias which could result in material misstatement due to fraud. x Evaluating the rationale for any changes in accounting policies estimate or significant unusual transactions. Page 47 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 19 Significant risks at the assertion level for classes of transaction, account balances and disclosures The table below summarises the significant risks of material misstatement at the assertion level for classes of transaction, account balances and disclosures. Identified risk of material misstatement Audit approach Fraud in non-pay expenditure (The Council and the Group) As most public sector bodies are net expenditure bodies, the risk of fraud is more likely to occur in expenditure. There is a risk that expenditure may be misstated resulting in a material misstatement in the financial statements. We have considered Practice Note 10, which comments that for certain public bodies, the risk of manipulating expenditure could exceed the risk of the manipulation of revenue. We have therefore also considered the risk of fraud in expenditure at the Council. Practice Note 10: audit of Financial Statements of Public Sector Bodies in the United Kingdom (PN10) states: “As most public bodies are net spending bodies, then the risk of material misstatement due to fraud related to expenditure may be greater than the risk of material misstatements due to fraud related to revenue recognition". We narrowed the risk of material misstatement in the accounts to non-pay expenditure, including accruals, to completeness as we regarded this aspect of expenditure to be at the highest risk for potential fraud or manipulation. Given the financial pressures facing the public sector as a whole, there is an inherent fraud risk associated with the Procedures performed to mitigate risks of material misstatement in this area will include: x Evaluating the significant non-pay expenditure streams and reviewing the controls in place over accounting for the completeness of expenditure and accruals. x Considering of the Council’s key areas of expenditure and obtaining evidence that expenditure is recorded in line with appropriate accounting policies and the policies have been applied consistently across the year. x Perform substantive testing on expenditure transactions at and around the year end to verify the accounting period transactions relate to and confirm that transactions have been recognised in the correct accounting period. x Testing of accruals around the year end to consider if these agree to supporting documentation and whether there is any indication of understatement of balances held through consideration of accounting estimates. Page 48 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 20 Identified risk of material misstatement Audit approach recording of expenditure around the year end. Inherent risk of material misstatement: x Non-pay expenditure (completeness): High x Accruals (completeness): High Valuation of land & buildings and council dwellings - key accounting estimate (The Council and the Group) The Council held council dwellings with a net book value of £733.9 million and land and buildings with a net book value of £375 million at 31 March 2024. The Council revalues land and buildings and council dwellings on a five-year rolling basis. Council dwellings are valued by the District Valuer using the beacon method which aggregates the vacant possession value of each unit of housing stock based on the value of a beacon or sample property. A full revaluation exercise is completed every five years. In interim years the values of beacon properties are updated to reflect key factors including changes in rental prices. Other land and buildings are held at current value and revalued as part of the five-year rolling programme. In addition, indices are applied to all assets held at Depreciated Replacement Cost (DRC) to reflect market changes within the year. There is a significant degree of subjectivity in the measurement and valuation of land, buildings and council dwellings. This subjectivity and the Procedures performed to mitigate risks of material misstatement in this area will include: x Evaluating management processes and assumptions for the calculation of the estimate, the instructions issued to the valuation experts and the scope of their work. x Evaluating the competence, capabilities and objectivity of management’s valuation expert. x Considering the basis on which the valuations are carried out and challenging the key assumptions applied. x Evaluating the reasonableness of the valuation movements for assets revalued during the year, with reference to market data. We will consider whether we require an auditor’s expert. x For unusual or unexpected valuation movements, testing the information used by the valuer to ensure it is complete and consistent with our understanding. x Ensuring revaluations made during the year have been input correctly to the fixed asset register and the Page 49 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 21 Identified risk of material misstatement Audit approach material nature of the Council’s asset base represents an increased risk of misstatement in the financial statements. There is a significant degree of subjectivity in the measurement and valuation of property, plant and equipment. This subjectivity and the material nature of the Council’s asset base represents an increased risk of misstatement in the annual accounts. We will further pinpoint this risk to specific assets, or asset types, on receipt of the draft financial statements and the year- end updated asset valuations to those assets where the in-year valuation movements falls outside of our expectations. Inherent risk of material misstatement: x Land & Buildings and council dwellings (valuation): High accounting treatment within the financial statements is correct. x Evaluating the assumptions made by management for any assets not revalued during the year and how management are satisfied that these are not materially different to the current value. Pension asset / liability - key accounting estimate (The Council and the Group) An actuarial estimate of the net defined pension liability/asset is calculated on an annual basis under IAS 19 ‘Employee Benefits’, and on a triennial funding basis, by an independent firm of actuaries with specialist knowledge and experience. The triennial estimates are based on the most up to date membership data held by the pension fund and a roll forward approach is used in intervening years, as permitted by the Code. The calculations involve a number of key assumptions, such as discount rates and inflation and local factors such as mortality rates and expected pay rises. Procedures performed to mitigate risks of material misstatement in this area will include: x Evaluating managements processes for the calculation of the estimate, the instructions issued to management’s expert (the actuary) and the scope of their work. x Evaluating the competence, capabilities and objectivity of the actuary. x Assessing the controls in place to ensure that the data provided to the actuary by the Council and their pension fund was accurate and complete. Page 50 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 22 Identified risk of material misstatement Audit approach The estimates are highly sensitive to changes in these assumptions (and the calculation of any asset ceiling when determining the value of a pension asset (where relevant)). ISAs (UK) 500 and 540 require us to undertake audit procedures on the use of external experts (the actuary) and the methods, assumptions and source data underlying the estimates. This represents a key accounting estimate made by management within the financial statements due to the size of the values involves, the subjectivity of the measurement and the sensitive nature of the estimate to changes in key assumptions. We have therefore identified the valuation of the net pension liability/asset as a significant risk. Inherent risk of material misstatement: x Pensions (valuation): High x Evaluating the methods, assumptions and source data used by the actuary in their valuations, with the support of an auditors’ expert. x Evaluating whether any asset ceiling was appropriately considered (if applicable) when determining the value of any pension asset included in the financial statements. x Assessing the impact of any significant differences between the estimated gross asset valuations included in the financial statements and the Council’s share of the investment valuations in the audited pension fund accounts. x Ensuring pension valuation movements for the year and related disclosures have been correctly reflected in the financial statements. IFRS 16 implementation impact on PPP/PFI arrangements (The Council and the Group) The adoption of IFRS 16 in local government accounts is mandatory from 2024/25. While the leases in place at the Council are not material, the new standard also applies to service concession arrangements (PFI, PPP, NPD). The Council had over £107.5 million worth of assets financed through PPP/PFI arrangements at 31 March 2024. As a result of the implementation of IFRS 16, the accounting treatment for indexation linked payments in liabilities Procedures performed to mitigate risks of material misstatement in this area will include: x Obtaining the evidence of management consideration of impact of IFRS 16 on its service concession arrangements and assessing work to identify all relevant contracts. x Examining management’s work on application of the new requirements, including indexation changes impact, liability remeasurement and reflecting changes in the financial statements Page 51 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 23 Identified risk of material misstatement Audit approach for service concession arrangements has changed. Local authorities must remeasure if there is a change in future lease payments resulting from a change in an index / rate used to determine those payments and ensure that the financial statements accurately reflect the impact of the revised IFRS 16 accounting arrangements. The implementation of the new requirements is complex and could have material impact on the council financial statements and therefore it increases the risk of misstatement. Inherent risk of material misstatement: PPP liability (valuation): High in line with accounting framework requirements. x Review the council’s accounting policies for the year ended 31 March 2025 to reflect the requirements of the new accounting standard. x Assess the adequacy of disclosures regarding service concession arrangements. Page 52 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 24 The wider scope of public audit The Code of Audit Practice frames a significant part of our responsibilities in terms of four wider scope audit areas: x Financial sustainability x Financial management x Vision, leadership and governance x Use of resources to improve outcomes. Our audit approach to the wider scope audit areas Appointed auditors are required to consider the wider scope areas when: x identifying significant audit risks at the planning stage of the audit x reaching conclusions on those risks x making recommendations for improvement x where appropriate, setting out conclusions on the audited body’s performance. When reporting on such arrangements, the Code of Practice requires us to structure our commentary under the four areas identified above. Appendix 1 provides further detail on the definition, scope and audit considerations under each wider scope area. Our planned audit work against these four areas is risk based and proportionate. Our initial assessment builds upon our understanding of the Council’s key priorities and risks along with discussions with management and review of Council and committee minutes and key strategy documents. We have identified one significant risk in relation to financial sustainability as set out in the table below. Audit planning is a continuous process and we will report all identified significant risks, as they relate to the four wider scope areas, in our annual audit report. Page 53 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 25 Wider scope significant risk Financial sustainability The Council considers its medium-term financial planning through its General Fund Financial Outlook report regularly presented to the full Council. The current expected budget gap prior to any decisions on council tax would be between £25- 40million over the period between 2025/26 and 2027/28. Assuming 6.5% council tax increases in the next three years the funding gap reduces to £5-25million and would require the Council to identify c.£8million of savings and efficiencies each year for the next three years. At the point of drafting this report £7million of savings have been included in 2025/26 budget. Any council tax increases would be subject to Council vote and approval. The Council has a Financial Sustainability reserve of £13.2million which it plans to utilise over the coming years. Various commitments to utilise this reserve and a reduction in employer pensions contributions will result in a forecast balance of c. £19 million in this reserve at the end of 2024/25. Further £12million from the reduced contributions will grow that reserve to an estimated £31million the following year. After that year the pension contributions increase to 17.5% and no further savings are expected from this change. The Council maintains a policy of minimum £10million of unallocated reserves (just over 2% of net expenditure) held for unplanned or emergency purposes. The Council reviewed its budget planning assumptions to reflect the financial challenges impacting on the external environment in which the Council operates. The draft budget presented in December 2024 by the Scottish Government indicated funding of £464million for the Council, an increase of 8.7% on the previous year (excluding additional funding in relation to National Insurance increases). The Council estimates that the NI increase will cost over £6 million annually, and that the additional funding from the Scottish Government will cover c.£4.4million of this cost. The Council has been using a ‘flat-cash’ funding assumption when planning their budgets. The actual core grant funding, adjusted for additional elements of responsibilities, increased by 2.3% on 2024/25, which is more positive than assumed. The Council highlights the fact that there is a timing disconnect between its ability to develop and deliver recurring savings to match the spend pressures which are emerging, resulting in a growing recurring financial gap. It becomes more likely that the Council will utilise reserves over the medium term to achieve financial balance. In addition to the funding and council tax increase, other planning assumptions included pay and contractual inflation cost pressures. The continuing and uncertain Page 54 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 26 Financial sustainability impact of cost pressures on the Council’s finances and ability to deliver services in a sustainable manner remains an ongoing challenge and risk. The medium-term financial challenge and financial gap is regularly considered by the Council, and a further £7million of savings has been incorporated into the 2025/26 draft budget. This does still leave a gap over the medium term, which poses an increasing risk to the Council’s delivery of services. Our audit response: During our audit we will review whether the Council has appropriate arrangements in place to manage its financial position. Our work will include an assessment of progress made in developing financially sustainable plans which reflect the medium and longer term impact of cost pressures and that continue to support the delivery of the Council’s statutory functions and strategic objectives. Further wider scope considerations In formulating our audit plan, we identified areas of further focus for our work in other wider scope areas: Financial management x Whether there are effective arrangements in place to budget for, monitor and deliver its capital plans. x Whether the planned savings in the year have been set realistically and were achieved. Vision, leadership and governance x Whether the leadership programme introduced was effective and impact of the programme is assessed on regular basis. x Impact of the results of the cultural assurance model and how it affects the Council work. Use of resources to improve outcomes x Impact of the savings exercises and budget reductions on the quality of the delivery of the Council services. x Whether the Council progressed its preparation to the new Statutory Performance Indicators Direction to be effective from 2025/26. Page 55 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 27 Renfrewshire Trust Funds Coats Observatory Trust Fund The Charities Accounts (Scotland) Regulations 2006 outline the accounting and auditing requirements for charitable bodies. The Regulations require an auditor to prepare a report to the charity trustees where an audit is required by any other enactment. The Council’s charitable trust is covered by the requirements of section 106 of the Local Government (Scotland) Act 1973 and consequently requires a full audit. Each registered charitable trust has required a full audit since 2013/14. There is one registered charity preparing its accounts on a receipts and payments basis – Coats Observatory Trust Fund. Significant risks at the financial statement level The table below summarises the significant risk of material misstatement identified at the financial statement level. This risk is considered to have a pervasive impact on the financial statements as a whole and potentially affect many assertions for classes of transaction, account balances and disclosures. Identified risk of material misstatement Audit approach Management override of controls (The Coats Observatory) Management is in a unique position to perpetrate fraud because of their ability to manipulate accounting records and prepare fraudulent financial statements by overriding controls that otherwise appear to be operating effectively. Although the level of risk of management override of controls will vary from entity to entity, the risk is nevertheless present in all entities. Due to the unpredictable way in which such override could occur, it is a risk Procedures performed to mitigate risks of material misstatement in this area will include: x Documenting our understanding of the journals posting process and evaluating the design effectiveness of management controls over journals. x Analysing the journals listing and determining criteria for selecting high risk and / or unusual journals. x Testing high risk and / or unusual journals posted during the year and after the unaudited annual accounts stage back to supporting documentation for appropriateness, corroboration and to ensure approval Page 56 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 28 Identified risk of material misstatement Audit approach of material misstatement due to fraud and thus a significant risk. Risk of material misstatement: Very High has been undertaken in line with the Trusts’ journals policy. x Gaining an understanding of the accounting estimates and critical judgements made by management. We will challenge assumptions and consider the reasonableness and indicators of bias which could result in material misstatement due to fraud. x Evaluating the rationale for any changes in accounting policies estimate or significant unusual transactions. Page 57 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 29 Audit team and timetable Audit Team Our audit team will be as follows: Role Name Email Engagement Lead Gary Devlin Gary.Devlin@azets.co.uk Engagement Director Rebecca Lister Rebecca.Lister@azets.co.uk Engagement Manager Adrian Kolodziej Adrian.Kolodziej@azets.co.uk Engagement Assistant Manager Ava Campbell Ava.Cambell@azets.co.uk Timetable Please find below confirmation of our proposed timetable for the audit as previously discussed with management: Output Target month / date Audit planning work, including planning meetings February – March 2025 Audit, Risk and Scrutiny Board to consider audit plan 17 March 2025 Best Value work February – May 2025 Interim audit March 2025 Best Value report presented to the Accounts Commission TBC Receipt of draft accounts 30 June 2025 Commencement audit fieldwork 7 July 2025 Audit, Risk and Scrutiny Board to consider accounts and audit report 22 September 2025 Page 58 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 30 Output Target month / date Council meeting to approve accounts for signing 25 September 2025 Grant claims and returns: x Non domestic rate income return (NDRI) x Housing benefit subsidy claim (HB) 31 December 2025 Our Requirements The audit process is underpinned by effective project management to co-ordinate and apply our resources efficiently to meet your deadlines. It is essential that the audit team and the Council’s finance team work closely together to achieve the above timetable. In order for us to be able to complete our work in line with the agreed fee and timetable, we require the following: x Draft financial statements of a good quality by the deadlines you have agreed with us. These should be complete including all notes, the performance report and the accountability report. x Good quality working papers at the same time as the draft financial statements. These will be discussed with you in advance to ensure clarity over our expectations. x Ensuring staff are available and on site (as agreed) during the period of the audit. x Prompt and adequate responses to audit queries. Page 59 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 31 Audit fee The quality of audit work is an essential requirement in successfully delivering a fully compliant ISA and Code of Audit Practice audit. Audit Scotland sets an expected audit fee that assumes the body has sound governance arrangements in place, has been operating effectively throughout the year, prepares comprehensive and accurate unaudited accounts and meets the agreed timetable for audit. The expected fee is reviewed by Audit Scotland each year, based on Audit Scotland’s overall budget proposals. The budget proposal and fee levels (for the 2024/25 audits) have been developed in the context of a challenging economic environment, increased expectations on the audit profession competitive environment in audit staff retention. The 2024/25 expected audit fee is based on applying a 1.9% increase to the 2023/24 expected audit fee. This increase is applied on a sector basis and reflects the conditions of the public sector market. As auditors we negotiate a fee with the Council during the planning process. The auditor remuneration element of the fee may be varied above the expected fee level to reflect the circumstances and local risks within the body. The expected fee for auditor remuneration set by Audit Scotland for the 2024/25 audit of the Council is £299,830. We propose setting the 2024/25 audit fee at £329,710 which equates to a 10% increase. We have increased the auditor remuneration element of the audit fee to reflect the level of work we consider is required in response to the key audit matters identified in this plan, implementation of accounting standard IFRS 16 – leases, changes to the International Standard on Auditing (UK) 600 – Audits of group financial statements, and requirement to deliver full Best Value review during this year’s audit. The breakdown of the fee for 2024/25 is shown in the table below. 2024/25 2023/24 Auditor remuneration £329,710 £316,514 Pooled costs £7,530 £10,490 Contribution to PABV costs £79,800 £82,680 Audit support costs - - Sectoral cap adjustment £61,830 £59,660 Total fee £478,870 £469,344 Page 60 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 32 We will take account of the risk exposure of the Council and the management assurances in place. We assume receipt of the draft working papers at the outset of our on-site final audit visit. If the draft accounts and papers are late, or agreed management assurances are unavailable, we reserve the right to charge an additional fee for additional audit work. An additional fee will be required in relation to any other significant work not within our planned audit activity. The Controller of Audit may require additional Best Value work outwith the core work contained within Audit Scotland’s methodology. We will notify you of any additional fees in relation to such work. Audit fee – Renfrewshire Council Charitable Trust (Coats Observatory) The audit fee in the table above does not include the cost of auditing charitable trust fund. We propose setting the audit fee for the audit of the charitable trust at £6,480 which represents 1.9% increase in line with Audit Scotland approach outlined above. Page 61 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 33 Audit independence and objectivity International Standard on Auditing (UK) 260 "Communication with those charged with governance" requires us to communicate on a timely basis all facts and matters that may have a bearing on our independence. In particular, FRC’s Ethical Standard stipulates that where an auditor undertakes non audit work, appropriate safeguards must be applied to reduce or eliminate any threats to independence. Azets has not been appointed by the Council to provide any non-audit services during the year. We confirm that we comply with FRC’s Ethical Standard. In our professional judgement, the audit process is independent and our objectivity has not been compromised in any way. In particular there are and have been no relationships between Azets and the Council, its elected members and senior management that may reasonably be thought to bear on our objectivity and independence. Page 62 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 34 Appendices Appendix 1: Responsibilities of the Auditor and the Council 35 Appendix 2: Materiality 42 Page 63 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 35 Appendix 1: Responsibilities of the Auditor and the Council The Accounts Commission, Controller of Audit and Audit Scotland The Accounts Commission is an independent public body. Its members are appointed by Scottish Ministers and are responsible for holding local government to account. Under statute, the Accounts Commission appoints a Controller of Audit to consider the results of the audit of accounts, including the wider-scope responsibilities and Best Value auditing. The Controller of Audit makes reports to the Accounts Commission on matters arising from the accounts and on Best Value and acts independently of the Accounts Commission when reporting to it. Audit Scotland is an independent statutory body that co-ordinates and supports the delivery of high-quality public sector audit in Scotland. Audit Scotland oversees the appointment and performance of auditors, provides technical support, delivers performance audit and Best Value work programmes and undertakes financial audits of public bodies. Auditor responsibilities Code of Audit Practice The Code of Audit Practice (the Code) describes the high-level, principles-based purpose and scope of public audit in Scotland. The 2021 Code came into effect from 2022/23. The Code of Audit Practice outlines the responsibilities of external auditors appointed by the Accounts Commission and it is a condition of our appointment that we follow it. Our responsibilities Auditor responsibilities are derived from the Code, statute, International Standards on Auditing (UK) and the Ethical Standard for auditors, other professional requirements and best practice, and guidance from Audit Scotland. We are responsible for the audit of the accounts and the wider-scope responsibilities explained below. We act independently in carrying out our role and in exercising professional judgement. We report to the Council and others, including Audit Scotland, on the results of our audit work. Page 64 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 36 Weaknesses or risks, including fraud and other irregularities, identified by auditors, are only those which come to our attention during our normal audit work in accordance with the Code and may not be all that exist. Wider scope audit work Reflecting the fact that public money is involved, public audit is planned and undertaken from a wider perspective than in the private sector. The wider scope audit specified by the Code broadens the audit of the accounts to include additional aspects or risks in areas of financial management; financial sustainability; vision, leadership and governance; and use of resources to improve outcomes. Financial management Financial management means having sound budgetary processes. Audited bodies require to understand the financial environment and whether their internal controls are operating effectively. Auditor considerations Auditors consider whether the body has effective arrangements to secure sound financial management. This includes the strength of the financial management culture, accountability, and arrangements to prevent and detect fraud, error and other irregularities. Financial sustainability Financial sustainability means being able to meet the needs of the present without compromising the ability of future generations to meet their own needs. Auditor considerations Auditors consider the extent to which audited bodies show regard to financial sustainability. They look ahead to the medium term (two to five years) and longer term (over five years) to consider whether the body is planning effectively so it can continue to deliver services. Page 65 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 37 Vision, leadership and governance Audited bodies must have a clear vision and strategy and set priorities for improvement within this vision and strategy. They work together with partners and communities to improve outcomes and foster a culture of innovation. Auditor considerations Auditors consider the clarity of plans to implement the vision, strategy and priorities adopted by the leaders of the audited body. Auditors also consider the effectiveness of governance arrangements for delivery, including openness and transparency of decision-making; robustness of scrutiny and shared working arrangements; and reporting of decisions and outcomes, and financial and performance information. Use of resources to improve outcomes Audited bodies need to make best use of their resources to meet stated outcomes and improvement objectives, through effective planning and working with strategic partners and communities. This includes demonstrating economy, efficiency and effectiveness through the use of financial and other resources, and reporting performance against outcomes. Auditor considerations Auditors consider the clarity of arrangements in place to ensure that resources are deployed to improve strategic outcomes, meet the needs of service users taking account of inequalities, and deliver continuous improvement in priority services. Best Value Appointed auditors have a duty to be satisfied that local government bodies have made proper arrangements to secure best value. Our work in respect of the Council’s best value arrangements is integrated into our audit approach, including our work on the wider scope areas as set out in this plan. Audit quality The Auditor General and the Accounts Commission require assurance on the quality of public audit in Scotland through comprehensive audit quality arrangements that Page 66 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 38 apply to all audit work and providers. These arrangements recognise the importance of audit quality to the Auditor General and the Accounts Commission and provide regular reporting on audit quality and performance. Audit Scotland maintains and delivers an Audit Quality Framework The most recent audit quality report can be found at Quality of public audit in Scotland: Annual report 2022/23 | Audit Scotland (audit-scotland.gov.uk) Page 67 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 39 Council responsibilities The Council has primary responsibility for ensuring the proper financial stewardship of public funds, compliance with relevant legislation and establishing effective arrangements for governance, propriety and regularity that enables it to successfully deliver its objectives. The features of proper financial stewardship include the following: Area Council responsibilities Corporate governance The Council is responsible for establishing arrangements to ensure the proper conduct of its affairs including the legality of activities and transactions, and for monitoring the adequacy and effectiveness of these arrangements. Those charged with governance should be involved in monitoring these arrangements. Financial statements and related reports The Council has responsibility for: x preparing financial statements which give a true and fair view of its financial position and its expenditure and income, in accordance with the applicable financial reporting framework and relevant legislation; x maintaining accounting records and working papers that have been prepared to an acceptable professional standard and that support its financial statements and related reports disclosures; x ensuring the regularity of transactions, by putting in place systems of internal control to ensure that they are in accordance with the appropriate authority; and x preparing and publishing, along with the financial statements, an annual governance statement, management commentary (or equivalent) and a remuneration report in accordance with prescribed requirements. Management commentaries should be fair, balanced and understandable. Management is responsible, with the oversight of those charged with governance, for communicating relevant information to users about the entity and its financial performance, including providing adequate disclosures in accordance with the applicable financial reporting framework. The relevant information should be communicated clearly and concisely. The Council is responsible for developing and implementing effective systems of internal control as well as financial, operational Page 68 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 40 Area Council responsibilities and compliance controls. These systems should support the achievement of its objectives and safeguard and secure value for money from the public funds at its disposal. The Council is also responsible for establishing effective and appropriate internal audit and risk-management functions. Standards of conduct for prevention and detection of fraud and error The Council is responsible for establishing arrangements to prevent and detect fraud, error and irregularities, bribery and corruption and also to ensure that its affairs are managed in accordance with proper standards of conduct by putting proper arrangements in place. Financial position The Council is responsible for putting in place proper arrangements to ensure the financial position is soundly based having regard to: x Such financial monitoring and reporting arrangements as may be specified; x Compliance with statutory financial requirements and achievement of financial targets; x Balances and reserves, including strategies about levels and their future use; x Plans to deal with uncertainty in the medium and long term; and x The impact of planned future policies and foreseeable developments on the financial position. Best value The Council has a specific responsibility to make arrangements to secure Best Value. Best Value is defined as continuous improvement in the performance of the body’s functions. In securing Best Value, the local government body is required to maintain an appropriate balance among: x The quality of its performance of its functions x The cost to the body of that performance Page 69 of 128
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Renfrewshire Council: External Audit Annual Plan 2024/25 41 Area Council responsibilities x The cost to persons of any service provided by it for them on a wholly or partly rechargeable basis. In maintaining that balance, the Council shall have regard to: x Efficiency x Effectiveness x Economy x The need to meet the equal opportunity requirements. The Council should discharge its duties in a way which contributes to the achievement of sustainable development. In measuring the improvement of the performance of a local government body’s functions for the purposes of this section, regard shall be had to the extent to which the outcomes of that performance have improved. The Scottish Government’s Statutory Guidance on Best Value (2020) requires bodies to demonstrate that they are delivering Best Value in respect of seven themes: 1. Vision and leadership 2. Governance and accountability 3. Effective use of resources 4. Partnerships and collaborative working 5. Working with communities 6. Sustainability 7. Fairness and equality. The Community Empowerment (Scotland) Act 2015 is designed to help empower community bodies through the ownership or control of land and buildings, and by strengthening their voices in decisions about public services. Specified audited bodies are required to prepare and publish performance information in accordance with Directions issued by the Accounts Commission. Page 70 of 128
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42 Appendix 2: Materiality Materiality is an expression of the relative significance of a matter in the context of the financial statements as a whole. A matter is material if its omission or misstatement would reasonably influence the decisions of an addressee of the auditor’s report. The assessment of what is material is a matter of professional judgement and is affected by our assessment of the risk profile of the organisation and the needs of users. We review our assessment of materiality throughout the audit. Whilst our audit procedures are designed to identify misstatements which are material to our audit opinion, we also report to the Council and management any uncorrected misstatements of lower value errors to the extent that our audit identifies these. Under ISA (UK) 260 ‘Communication with those charged with governance’, we are obliged to report uncorrected omissions or misstatements other than those which are ‘clearly trivial’ to those charged with governance. ISA (UK) 260 defines ‘clearly trivial’ as matters that are clearly inconsequential, whether taken individually or in aggregate and whether judged by any quantitative or qualitative criteria. Group and the Council materiality Group £million Council £million Overall materiality for the financial statements 17.90 17.80 Performance materiality 13.43 13.35 Trivial threshold 0.895 0.890 Materiality Our assessment is made with reference to the Council’s gross expenditure. We consider this to be the principal consideration for the users of the annual accounts when assessing financial performance. Our assessment of materiality equates to approximately 2% of the Council’s gross expenditure as disclosed in the 2023/24 audited annual accounts. This is consistent with our prior year judgement. Performance materiality Performance materiality is the working level of materiality used throughout the audit. We use performance materiality to determine the nature, timing and extent of audit procedures Page 71 of 128
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43 carried out. We perform audit procedures on all transactions, or groups of transactions, and balances that exceed our performance materiality. This means that we perform a greater level of testing on the areas deemed to be at significant risk of material misstatement. Performance materiality is set at a value less than overall materiality for the financial statements as a whole to reduce to an appropriately low level the probability that the aggregate of the uncorrected and undetected misstatements exceed overall materiality. Specific materiality We also consider materiality qualitatively. In areas where users are particularly sensitive to inaccuracy or omission, we may treat misstatements as material even below the principal threshold. In performing our audit, we apply a lower level of materiality of £5,000 to the audit of the Remuneration Report: senior officer and councillor remuneration tables. Trivial misstatements Trivial misstatements are matters that are clearly inconsequential, whether taken individually or in aggregate and whether judged by any quantitative or qualitative criteria. We set it as 5% of the overall materiality, in line with our standard methodology. Coats Observatory materiality Overall materiality (£) Performance materiality (£) Trivial threshold (£) Coats Observatory Trust Fund £45,000 £34,000 £2,000 Overall materiality: our assessment is based on approximately 3% of net assets. We consider this benchmark to be the principal consideration for the users of the financial statements when assessing the performance of the charitable trust. Performance materiality: Using our professional judgement we have calculated performance materiality at approximately 75% of overall materiality. Trivial threshold: 5% of overall materiality for the financial statements. Page 72 of 128
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44 Common Good Funds materiality The Council maintains three Common Good funds, which were deregistered as charities two years ago and do not require a separate audit opinion. However, we set out separate materiality levels for these funds as these will be specifically covered by the Renfrewshire Council auditor’s opinion and are shown as a separate statement in the Council’s financial statements. Overall materiality (£) Performance materiality (£) Trivial threshold (£) Paisley £191,000 £143,000 £9,600 Johnstone £1,560 £1,170 £100 Renfrew £1,085,000 £814,000 £54,000 Overall materiality: our assessment is based on approximately 3% of net assets. We consider this benchmark to be the principal consideration for the users of the financial statements when assessing the performance of each charitable trust. Performance materiality: Using our professional judgement we have calculated performance materiality at approximately 75% of overall materiality. Trivial threshold: 5% of overall materiality for the financial statements, with the Johnstone Fund rounded up to £100. Page 73 of 128
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We are an accounting, tax, audit, advisory and business services group that delivers a personal experience both digitally and at your door. Accounting | Tax | Audit | Advisory | Technology © Azets 2025. All rights reserved. Azets refers to Azets Audit Services Limited. Registered in England & Wales Registered No. 09652677. VAT Registration No. 219 0608 22. Registered to carry on audit work in the UK and regulated for a range of investment business activities by the Institute of Chartered Accountants in England and Wales. Page 74 of 128
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1 ___________________________________________________________________ To: Audit, Risk and Scrutiny Board On: 17 March 2025 ___________________________________________________________________ Report by: Chief Auditor ___________________________________________________________________ Heading: Internal Audit Review of Compliance with the Code of Corporate Governance ___________________________________________________________________ 1. Summary 1.1 Corporate governance is the name given to the system by which Councils direct and control their functions. It is about ensuring that councils do the right things, in the right way, for the right people, in a timely, inclusive, open, honest and accountable manner. 1.2 The Chief Executive has responsibility for reporting annually to the Audit, Risk and Scrutiny Board on compliance with the Code and any changes to the Code that may be necessary to maintain it and ensure its effectiveness in practice. In addition, the Council’s Interim Chief Auditor has responsibility to review independently and report to the Audit, Risk and Scrutiny Board annually, to provide assurance on the adequacy and effectiveness of the Code and the extent of compliance with it. 1.3 Internal Audit has reviewed the adequacy and effectiveness of the revised Code which was presented to the Audit, Risk and Scrutiny Board on 18 March 2024. Based on our sample check of the evidence used to demonstrate compliance, we would confirm that the Council complies with the requirements of the Local Code of Corporate Governance. In addition, it is evident that the Local Code has been subject to review and updating in line with developments in best practice and any revised Council Policies. Item 4 Page 75 of 128
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2 1.4 The Chief Executive endorses the Interim Chief Auditor’s recommendation that the Local Code should continue to be subject to an annual review to ensure that it continues to reflect developments in best practice in governance. ___________________________________________________________________ 2. Recommendations 2.1 Members are invited to note the contents of this report. _________________________________________________________ 3. Background 3.1 Delivering Good Governance in Local Government: Framework, published by CIPFA in association with Solace in 2007, set the standard for local authority governance in the UK. CIPFA and Solace reviewed the Framework in 2015 to ensure it remains ‘fit for purpose’ and published a revised edition in spring 2016. The new code places greater emphasis on relationship and behaviours between elected members and senior management; performance reporting; and council and service level plans. 3.2 The Council’s Local Code of Corporate Governance has been reviewed and updated in line with this framework and to reflect any updated Council policies. Page 76 of 128
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3 ___________________________________________________________________ Implications of the Report 1. Financial - None 2. HR & Organisational Development - None 3. Community Planning – None 4. Legal - None 5. Property/Assets - None 6. Information Technology - None 7. Equality & Human Rights – None 8. Health & Safety – None 9. Procurement - None 10. Risk - None 11. Privacy Impact – None 12. COSLA Implications – None 13. Climate Risk – None 14. Children’s Rights - None ___________________________________________________________________ Author: Karen Campbell, Interim Chief Auditor – 0141 487 0678 Page 77 of 128
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Page 1 of 43 To: Audit, Risk and Scrutiny Board On: 17 March 2025 Report by: Chief Executive Heading: Annual Review of Compliance with the Local Code of Corporate Governance 2024 1. Summary 1.1. Corporate governance is the name given to the system by which Councils direct and control their functions. It is about ensuring that Councils do the right things, in the right way, for the right people, in a timely, inclusive, open, honest and accountable manner. 1.2. Delivering Good Governance in Local Government: Framework, which was refreshed in 2016 by CIPFA in association with Solace, is the framework which sets the standard for local authority governance in the UK and has been adopted by Renfrewshire Council as the Code of Corporate Governance. The Council formally reviews its compliance with the Code every year and this report provides evidence of that compliance. Each year, the Chief Auditor also provides a report to this Board detailing Internal Audit’s assessment of the Council’s internal control environment and any exposure to risk. 1.3. These annual reviews support the Council in continuous improvement; by considering the evidence of compliance, we can respond to organisational learning and use that to further strengthen our approach. 1.4. Appendix 1 provides a list of the seven overarching principles and sub-principles against which compliance is measured. Appendix 2 provides a detailed description of the evidential documents which demonstrate continued compliance, and notes which principles they relate too. Item 5 Page 79 of 128
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Page 2 of 43 2. Recommendations 2.1 It is recommended that members of the Audit, Risk and Scrutiny Board note: • the Council’s compliance with the Local Code of Corporate Governance; • note the evidence for compliance set out in Appendix 2: • note that compliance with the code is also subject to regular, planned internal audit activity. ___________________________________________________________________ 3. Background 3.1 CIPFA published the Delivering Good Governance in Local Government: Framework in 2007 to set the standard for local authority governance in the UK. It reviewed and published a revised edition in 2016 to ensure it remained ‘fit for purpose’. The updated code places greater emphasis on relationships and behaviours between Elected Members and senior management; performance reporting; and Council and service level plans. Renfrewshire Council has adopted this as its own Code of Corporate Governance, and reviews compliance on an annual basis. 3.2 The Code of Corporate Governance covers the seven core principles which bring together the main elements of Council business. These are: 1. Behaving with integrity, demonstrating strong commitment to ethical values, and respecting the rule of law. 2. Ensuring openness and comprehensive stakeholder engagement. 3. Defining outcomes in terms of sustainable economic, social, and environmental benefits. 4. Determining the interventions necessary to optimise the achievement of the intended outcomes. 5. Developing the entity’s capacity, including the capability of its leadership and the individuals within it. 6. Managing risks and performance through robust internal control and strong public financial management. 7. Implementing good practices in transparency, reporting, and audit to deliver effective accountability. 3.3 The sub-principles which sit beneath these are set out in Appendix 1 to this report. 3.4 A summary of the evidence which demonstrates compliance is provided is Section 4 of this report. A detailed list of documents and processes presented as evidence is included as Appendix 2. 3.5 Each year, the framework is reviewed by Internal Audit to assess the adequacy and effectiveness of the code, and the Council’s compliance with it. These findings are reported to the Audit, Risk and Scrutiny Board to provide additional assurance. Page 80 of 128
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Page 3 of 43 4. Compliance with the Code in 2024 4.1 Each of the seven principles is broken down into sub-sections (see Appendix 1), and these are further broken down to cover specific functions. This section of the report will consider compliance levels against each of the seven principles. More detailed descriptions of the evidence for compliance are given in Appendix 2. Principle 1: Integrity, ethical values and respecting the rule of law 4.2 The first of the seven principles has three sub-sections: behaving with integrity, demonstrating strong commitment to ethical values, and respecting the rule of law. 4.3 Codes of Conduct are in place for elected members and for employees, as well as a protocol for the relationships between political groups, elected members and officers. Elected members agree to adhere to the code of conduct when they formally accept office, and staff agree adherence on commencing employment with Renfrewshire Council. There is also a separate Code of Conduct on Gifts and Hospitality. Elected members are required to update their register of interests every six months, and to declare any interests appropriately at meetings. Protocols for member/officer relationships were reviewed in 2024 and an updated version approved by Council on 29 February 2024. Chief Officers are required to provide a register of interests on an annual basis. 4.4 There are policies and procedures in place to provide a framework by which business is conducted in a fair and transparent manner. These range from standing orders for contracts and the scheme of delegation to recruitment policies and financial regulations. Policy board reports are available to the public, except where exempted within the parameters of the law. 4.5 The Council expects staff and elected members to demonstrate behaviours which are in line with the Council’s Values – “We are fair”, “We are helpful”, “We are great collaborators”, “We value learning”. PRINCIPLE 2: Ensuring openness and comprehensive stakeholder engagement 4.6 The second principle has three sub-sections: openness; engaging comprehensively with institutional stakeholders; and engaging stakeholders effectively, including individual citizens and service users. 4.7 As noted above in 4.4, the Council publishes all board papers and maintains an archive online, so that interested parties can access them. The Council Plan, and the service plans which sit below it, are clear articulations of the Council’s priorities and strategic direction, and progress in achieving this is reported regularly to relevant policy boards. The Petitions Board provides an opportunity for individuals and communities to raise issues with the Council; in 2024, the board met twice. 4.8 The council’s marketing and communication team works with services to ensure the council’s policies and decisions made by Council Boards are clearly explained and Page 81 of 128
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Page 4 of 43 communicated locally through several communication channels. The Council has developed a network of local partners and community groups who cascade Council information through their own channels, increasing the reach of key messages. 4.9 The Council uses a range of communication channels and consultation mechanisms to engage with stakeholders. These include public campaigns, the council website, social media channels and participatory budgeting campaigns such as You Decide, and the work of local partnerships. Targeted consultation is undertaken in relation to specific projects and initiatives, for example tenant consultations on rent, housing regeneration consultations, or our Renfrewshire Climate Panel. In 2025, a refreshed and strengthened Council-wide approach to consultation and engagement will be rolled out following approval of a new Consultation and Engagement policy by the Leadership Board on 19 February 2025. PRINCIPLE 3: Defining outcomes in terms of sustainable economic, social and environmental benefits 4.9 There are two sub-sections to principle 3: defining outcomes and sustainable economic, social and environmental benefits. 4.10 The Council’s approach to service and strategic planning ensures a golden thread linking back service activity to the strategic priorities of the Council and to the Community Plan. A key element is a focus on what the intended outcome of activity is, framed in terms of the impact on citizens. As a five-year plan, the Council Plan allows for a longer-term view whilst retaining flexibility to adjust to changes in circumstances (as was demonstrated during the pandemic). The Council Plan underwent a refresh in mid-2024 to reflect the changing context since 2022. 4.11 The Council’s procurement approach reflects a commitment to these outcomes and seeks to deliver community benefits and assurance of sustainability through provider arrangements. PRINCIPLE 4: Determining the interventions necessary to optimise the achievement of the intended outcomes 4.12 Principle 4 has three sub-sections: determining interventions; planning interventions; and optimising achievement of intended outcomes. 4.13 Decision-making processes allow for consideration of options and risks, and builds in feedback from stakeholders including citizens, staff, elected members and partners. This is evidenced through a wide range of informal and formal engagement processes, in the work of Local Partnerships and in reports to Boards and Council. 4.14 The approach outlined in paragraph 4.10 above is one way in which the Council demonstrates compliance with principles relating to strategic and service-level planning. That approach includes a performance framework aligned to Council Plan themes. A regular programme of performance scrutiny is in place to monitor progress in the delivery of priority actions and against performance indicators. Partnership arrangements, including those within the Community Planning framework, also serve as demonstrations of how interventions are Page 82 of 128
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Page 5 of 43 determined and planned. The Council’s financial planning and monitoring framework ensures that resources are aligned with priorities and are managed appropriately and sustainably. Our approach locally has recently been reviewed in relation to the updated SPI Direction published by the Accounts Commission in January 2025. PRINCIPLE 5: Developing the entity’s capacity, including the capability of its leadership and the individuals within it. 4.15 There are two sub-sections within this principle: developing the entity’s capacity and developing the capability of the entity’s leadership and other individuals. 4.16 Monitoring of plans and performance are only one way in which the Council tracks and ensures effectiveness. Benchmarking provides a useful means of identifying good practice in other councils, and partnership working can allow council services to find added value through collaboration. The Local Government Benchmarking Framework provides an opportunity to compare with all other Scottish councils on indicators covering our main areas of service. Informal and ad hoc benchmarking also takes place. 4.17 As well as the formal protocols and codes noted in 4.3, a shared understanding of roles and priorities is fostered through regular meetings between senior managers and elected members, and through the Cross-Party Sounding Board. Briefings are also provided to elected members prior to policy boards and as require on ad-hoc issues at an authority and ward level. A new cross-party member-officer group has recently been established to support the work on Renfrewshire’s Local Development Plan. 4.18 The capabilities of individuals are developed through formal training, whether self-directed through platforms such as iLearn or the Improvement Service’s CPD framework for elected members, and through an annual programme of briefings and seminars. A specific programme of leadership development for the Council’s most senior managers was delivered in 2024 and is currently being evaluated so that the approach can be tailored for future phases with other senior staff. 4.19 The Council has invested in support for employee wellbeing and introduced a People, Performance and Wellbeing Strategy in 2024; this replaced the People, Performance and Talent Strategy. A comprehensive review of HR policies continues to be undertaken, with wellbeing threaded through. Recent work has included a new Managing Attendance Policy, a new Carers Policy, the introduction of a Menopause Policy, the introduction of a Pregnancy Loss Policy, and a revised Parenting Leave and Pay Policy. PRINCIPLE 6: Managing risks and performance through robust internal controls and strong public financial management 4.19 The sixth principle has five sub-sections: managing risk; managing performance; Page 83 of 128
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Page 6 of 43 robust internal control; managing data; and strong public financial management. 4.20 The Council has an overarching risk management policy and strategy which sets the approach, and corporate and strategic risk registers which are reviewed regularly and are subject to scrutiny by senior managers and elected members. A Corporate Risk Management Group ensures there is consistency across all services and provides a mechanism for sharing learning and good practice. Programme Boards exist for major programmes such as City Deal, Learning Estate Investment and the Cultural Infrastructure Programme, and it is through those mechanisms that programme risk is assessed, monitored and mitigated. This approach to risk management is also built in to the approach of the Council’s Programme Management Unit. In 2024, the Council commissioned Willis Towers Watson to undertake an independent review of the Council’s risks management approach and provided a very positive report, noting the strong governance and positive culture towards risk management at the corporate level. They also noted the “innovative and powerful” approach of our Business-As-Usual Risk Assurance Model. 4.21 Performance management and monitoring is a key feature of service and strategic planning, and is one of the ways that services demonstrate delivery and impact. The Council currently uses Pentana as its main tool for collating performance data. Comparative performance through the LGBF is reported to Board and also made available on the Council's website in the form of interactive dashboards alongside case studies. Service level performance information is also subject to regular scrutiny by the Corporate Management Team and at the relevant Policy Boards. 4.22 The Council’s complaints handling guidance was reviewed and updated in 2024 to reflect the latest advice from the Scottish Public Service Ombudsman (SPSO). A refreshed quality assurance process was introduced in 2024 with a cross-council team reviewing a random sample of complaints against SPSO guidance to ensure expected standards are being met. An annual report on complaints handling is provided to the Audit, Risk and Scrutiny Board. 4.23 There are robust financial regulations in place, and budgetary positions and financial outlooks are regularly provided to elected members. Internal Audit undertakes several in-depth audits every year, and specific protocols are in place to deal with any issues arising in relation to potential fraud. 4.24 The Audit, Risk and Scrutiny Board provides a further level of control and scrutiny which is independent of the administration. The Board can direct officers to undertake reviews on particular issues and is the body that considers the Council’s Annual Audit Report, and oversees the management of risk. In the 2023 Best Value Report, the Council’s Auditors “recommended that the Council evaluates of the effectiveness of the Audit, Scrutiny and Risk Board against CIPFA good practice guidelines.” All actions arising from that review have been completed and an additional programme of member training for the Audit, Risk and Scrutiny Board is in place. 4.25 A robust corporate approach ensures that information governance policy and Page 84 of 128
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Page 7 of 43 processes are rigorous. The Data Advisory Group provides corporate leadership on the management and use of data, and is responsible for the Council’s Data Strategy. 4.26 All senior officers in the Council undertook governance training in 2023/24, which provided information on updated protocols and a refresher on good governance practice. PRINCIPLE 7: Implementing good practices in transparency, reporting and audit to deliver effective accountability 4.27 There are three sub-sections to principle seven: implementing good practice in transparency; implementing good practices in reporting; assurance and effective accountability. 4.28 As well as publishing reports to Policy Boards, financial strategies, annual accounts and other information of interest to stakeholders, the Council produces an annual Public Performance Report which makes use of maps, data, images and video to tell the story of how the Council is performing. Performance updates on the Council Plan, Community Plan and Service Improvement Plans are also available on the Council’s website. 4.29 Reports such as this, the annual financial statements, the annual governance statement and the reports to Audit, Risk and Scrutiny Board all seek to highlight how the Council operates and what it delivers, and to provide the transparency and assurance which is at the core of the Nolan principles. ___________________________________________________________________ Implications of the Report 1. Financial – none, though the report makes reference to financial governance matters. 2. HR & Organisational Development – none, though the report makes reference to a number of HR polices and procedures. 3. Community/Council Planning – none. The report makes reference to engagement mechanisms with a range of community stakeholders. 4. Legal – The Council must meet legal requirements in how it operates and this report details the way in which it can demonstrate good governance. 5. Property/Assets – none. 6. Information Technology – none Page 85 of 128
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Page 8 of 43 7. Equality & Human Rights - This report is for noting only and there are no recommendations which would need assessed in terms of their impact on equality groups or human rights. 8. Health and Safety – none. 9. Procurement – none, though the report provides information on Council Standing Orders. 10. Risk - The Council must comply with CIPFA’s Local Code of Corporate Governance. There is a risk of legal consequences and reputational damage if there is non- compliance. 11. Privacy Impact – none. 12. COSLA Policy Position – none. 13. Children’s Rights 14. Climate – none. _________________________________ List of Background Papers None ___________________________________________________________________ Author: Lisa Fingland, Policy Manager, lisa.fingland@renfrewshire.gov.uk Page 86 of 128
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Page 9 of 43 Appendix 1: Principles of Good Governance in Local Government 1. Behaving with integrity, demonstrating strong commitment to ethical values, and respecting the rule of law 1.1 Behaving with integrity 1.1.1 Ensuring members and officers behave with integrity and lead a culture where acting in the public interest is visibly and consistently demonstrated thereby protecting the reputation of the organisation 1.1.2 Ensuring members take the lead in establishing specific standard operating principles or values for the organisation and its staff and that they are communicated and understood. These should build on the Seven Principles of Public Life (the Nolan Principles) 1.1.3 Leading by example and using these standard operating principles or values as a framework for decision making and other actions. 1.1.4 Demonstrating, communicating and embedding the standard operating principles or values through appropriate policies and processes which are reviewed on a regular basis to ensure that they are operating effectively. 1.2 Demonstrating strong commitment to ethical values 1.2.1 Seeking to establish, monitor and maintain the organisation’s ethical standards and performance. 1.2.2 Underpinning personal behaviour with ethical values and ensuring they permeate all aspects of the organisation’s culture and operation. 1.2.3 Developing and maintaining robust policies and procedures which place emphasis on agreed ethical values. 1.2.4 Ensuring that external providers of services on behalf of the organisation are required to act with integrity and in compliance with high ethical standards expected by the organisation. 1.3 Respecting the rule of law 1.3.1 Ensuring members and staff demonstrate a strong commitment to rule of the law as well as adhering to relevant laws and regulations. 1.3.2 Creating the conditions to ensure that the statutory officers, other key post holders and members are able to fulfil their responsibilities in accordance with legislative and regulatory requirements. 1.3.3 Striving to optimise the use of the full powers available for the benefit of citizens, communities and other stakeholders. 1.3.4 Dealing with breaches of legal and regulatory provisions effectively. 1.3.5 Ensuring corruption and misuse of power are dealt with effectively. 2. Ensuring openness and comprehensive stakeholder engagement 2.1 Openness 2.1.1 Ensuring an open culture through demonstrating, documenting and communicating the organisation’s commitment to openness. 2.1.2 Making decisions that are open about actions, plans, resource use, forecasts, outputs and outcomes. The presumption is for openness. If that is not the case, a justification for the reasoning for keeping a decision confidential should be provided. 2.1.3 Providing clear reasoning and evidence for decisions in both public records and explanations to stakeholders and being explicit about the criteria, rationale and considerations used. In due course, ensuring that the impact and consequences of those decisions are clear. Page 87 of 128
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Page 10 of 43 2.1.4 Using formal and informal consultation and engagement to determine the most appropriate and effective interventions / courses of action. 2.2 Engaging comprehensively with institutional stakeholders 2.2.1 Effectively engaging with institutional stakeholders to ensure that the purpose, objectives and intended outcomes for each stakeholder relationship are clear so that outcomes are achieved successfully and sustainably. 2.2.2 Developing formal and informal partnerships to allow for resources to be used more efficiently and outcomes achieved more effectively. 2.2.3 Ensuring that partnerships are based on: trust; a shared commitment to change; a culture that promotes and accepts challenge amongst partners; and that the added value of partnership working is explicit. 2.3 Engaging with individual citizens and service users effectively. 2.3.1 Establishing a clear policy on the type of issues that the organisation will meaningfully consult with or involve communities, individual citizens, service users and other stakeholders to ensure that service (or other) provision is contributing towards the achievements of intended outcomes. 2.3.2 Ensuring that communication methods are effective and that members and officers are clear about their roles with regard to community engagement. 2.3.3 Encouraging, collecting and evaluating the views and experience of communities, citizens, service users and organisations of different backgrounds including reference to future needs. 2.3.4 Implementing effective feedback mechanisms in order to demonstrate how their views have been taken into account. 2.3.5 Balancing feedback from more active stakeholder groups with other stakeholder groups to ensure inclusivity. 2.3.6 Taking account of the interests of future generations of taxpayers and service users. 3. Defining outcomes in terms of sustainable economic, social and environmental benefits 3.1 Defining outcomes 3.1.1. Having a clear vision which is an agreed formal statement of the organisation’s purpose and intended outcomes containing appropriate performance indicators, which provides the basis for the organisation’s overall strategy, planning and other decisions. 3.1.2 Specifying the intended impact on, or changes for, stakeholders including citizens and service users. It could be immediately or over the course of a year or longer. 3.1.3 Delivering defined outcomes on a sustainable basis within the resources that will be available. 3.1.4 Identifying and managing risks to the achievement of outcomes. 3.1.5 Managing service users’ expectations effectively with regard to determining priorities and making the best use of the resources available. 3.2 Sustainable economic, social and environmental benefits 3.2.1 Considering and balancing the combined economic, social and environmental impact of policies, plans and decisions when taking decisions about service provision. 3.2.2 Taking a longer-term view with regard to decision making, taking account of risk and acting transparently where there are potential conflicts between the organisation’s intended outcomes and short-term factors such as the political cycle or financial constraints. Page 88 of 128
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Page 11 of 43 3.2.3 Determining the wider public interest associated with balancing conflicting interests between achieving the various economic, social and environmental benefits, through consultation where possible, in order to ensure appropriate trade-offs. 3.2.4 Ensuring fair access to services. 4. Determining the interventions necessary to optimise the achievement of intended outcomes 4.1 Determining interventions 4.1.1 Ensuring decision makers receive objective and rigorous analysis of a variety of options indicating how intended outcomes would be achieved and including the risks associated with those options. Therefore ensuring best value is achieved however services are provided. 4.1.2 Considering feedback from citizens and service users when making decisions about service improvements or where services are no longer required in order to prioritise competing demands within limited resources available including people, skills, land and assets and bearing in mind future impacts. 4.2 Planning interventions 4.2.1 Establishing and implementing robust planning and control cycles that cover strategic and operational plans, priorities and targets. 4.2.2 Engaging with internal and external stakeholders in determining how services and other courses of action should be planned and delivered. 4.2.3 Considering and monitoring risks facing each partner when working collaboratively including shared risks. 4.2.4 Ensuring arrangements are flexible and agile so that the mechanisms for delivering outputs can be adapted to changing circumstances. 4.2.5 Establishing appropriate key performance indicators (KPIs) as part of the planning process in order to identify how the performance of services and projects is to be measured. 4.2.6 Ensuring capacity exists to generate the information required to review service quality regularly. 4.2.7 Preparing budgets in accordance with organisational objectives, strategies and the medium-term financial plan. 4.2.8 Informing medium and long-term resource planning by drawing up realistic estimates of revenue and capital expenditure aimed at developing a sustainable funding strategy. 4.3 Optimising achievement of intended outcomes 4.3.1 Ensuring the medium-term financial strategy integrates and balances service priorities, affordability and other resource constraints. 4.3.2 Ensuring the budgeting process is all-inclusive, taking into account the full cost of operations over the medium and longer term. 4.3.3 Ensuring the medium term financial strategy sets the context for ongoing decisions on significant delivery issues or responses to changes in the external environment that may arise during the budgetary period in order for outcomes to be achieved while optimising resource usage. 4.3.4 Ensuring the achievement of ‘social value’ through service planning and commissioning. 5. Developing the entity’s capacity, including the capacity of its leadership and the individuals within it 5.1 Developing the entity’s capacity Page 89 of 128
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Page 12 of 43 5.1.1 Reviewing operations, performance and use of assets on a regular basis to ensure their continuing effectiveness. 5.1.2 Improving resource use through appropriate application of techniques such as benchmarking and other options in order to determine how the authority’s resources are allocated so that outcomes are achieved effectively and efficiently. 5.1.3 Recognising the benefits of partnerships and collaborative working where added value can be achieved. 5.1.4 Developing and maintaining an effective workforce plan to enhance the strategic allocation of resources. 5.2 Developing the capability of the entity’s leadership and other individuals 5.2.1 Developing protocols to ensure that elected and appointed leaders negotiate with each other regarding their respective roles early on in the relationship and that a shared understanding of roles and objectives is maintained. 5.2.2 Publishing a statement that specifies the types of decisions that are delegated and those reserved for the collective decisions making of the governing body. 5.2.3 Ensuring the leader and the chief executive have clearly defined and distinctive leadership roles within a structure, whereby the chief executive leads the authority in implementing the strategy and managing the delivery of services and other outputs set by members and each provides a check and a balance for each other’s authority. 5.2.4 Developing the capabilities of members and senior management to achieve effective shared leadership and to enable the organisation to respond successfully to changing legal and policy demands as well as economic, political and environmental changes and risks by: ensuring members and staff have access to appropriate induction tailored to their role and that ongoing training and development matching individual and organisational requirements is available and encouraged; ensuring members and officers have the appropriate skills, knowledge, resources and support to fulfil their roles and responsibilities and ensuring that they are able to update their knowledge on a continuing basis; ensuring personal, organisational and system-wide development through shared learning, including lessons learnt from both internal and external governance weaknesses. 5.2.5 Ensuring that there are structures in place to encourage public participation. 5.2.6 Taking steps to consider the leadership’s own effectiveness and ensuring leaders are open to constructive feedback from peer review and inspections. 5.2.7 Holding staff to account through regular performance reviews which take account of training or development needs. 5.2.8 Ensuring arrangements are in place to maintain the health and wellbeing of the workforce and support individuals in maintaining their own physical and mental wellbeing. 6. Managing risks and performance through robust internal control and strong public financial management 6.1 Managing risk 6.1.1 Recognising that risk management is an integral part of all activities and must be considered in all aspects of decision making. 6.1.2 Implementing robust and integrated risk management arrangements and ensuring that they are working effectively. 6.1.3 Ensuring that responsibilities for managing individual risks are clearly allocated. Page 90 of 128
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Page 13 of 43 6.2 Managing performance 6.2.1 Monitoring service delivery effectively including planning, specification, execution and independent post-implementation review. 6.2.2 Making decisions based on relevant, clear objective analysis and advice pointing out the implications and risks inherent in the organisation’s financial, social and environmental position and outlook. 6.2.3 Ensuring an effective scrutiny or oversight function is in place which encourages constructive challenge and debate on policies and objectives before, during and after decisions are made thereby enhancing the organisation’s performance and that of any organisation for which it is responsible; OR, for a committee system, encouraging effective and constructive challenge and debate on policies and objectives to support balanced and effective decision making 6.2.4 Providing members and senior management with regular reports on service delivery plans and on progress towards outcome achievement. 6.2.5 Ensuring there is consistency between specification stages (such as budgets) and post-implementation reporting (e.g. financial statements). 6.3 Robust internal control 6.3.1 Aligning the risk management strategy and policies on internal control with achieving objectives. 6.3.2 Evaluating and monitoring risk management and internal control on a regular basis. 6.3.3 Ensuring effective counter fraud and anti-corruption arrangements are in place. 6.3.4 Ensuring additional assurance on the overall adequacy and effectiveness of the framework of governance, risk management and control is provided by the internal auditor. 6.3.5 Ensuring an audit committee or equivalent group or function which is independent of the executive and accountable to the governing body provides a further source of effective assurance regarding arrangements for managing risk and maintaining an effective control environment, and that its recommendations are listened to and acted upon. 6.4 Managing data 6.4.1 Ensuring effective arrangements are in place for the safe collection, storage, use and sharing of data, including processes to safeguard personal data 6.4.2 Ensuring effective arrangements are in place and operating effectively when sharing data with other bodies. 6.4.3 Reviewing and auditing regularly the quality and accuracy of data used in decision making and performance monitoring. 6.5 Strong public financial management 6.5.1 Ensuring financial management supports both long-term achievement of outcomes and short-term financial and operational performance. 6.5.2 Ensuring well-developed financial management is integrated at all levels of planning and control, including management of financial risks and controls. 7. Implementing good practices in transparency, reporting and audit to deliver effective accountability 7.1 Implementing good practice in transparency 7.1.1 Writing and communicating reports for the public and other stakeholders in an understandable style appropriate to the intended audience and ensuring that they are easy to access and interrogate. Page 91 of 128
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Page 14 of 43 7.1.2 Striking a balance between providing the right amount of information to satisfy transparency demand and enhance public scrutiny while not being too onerous to provide and for users to understand. 7.2 Implementing good practices in reporting 7.2.1 Reporting at least annually on performance, value for money and the stewardship of its resources. 7.2.2 Ensuring members and senior management own the results. 7.2.3 Ensuring robust arrangements for assessing the extent to which the principles contained in the Framework have been applied and publishing the results on this assessment including an action plan for improvement and evidence to demonstrate good governance (annual governance statement) 7.2.4 Ensuring that the Framework is applied to jointly managed or shared service organisations as appropriate. 7.2.5 Ensuring the performance information that accompanies the financial statements is prepared on a consistent and timely basis and the statements allow for comparison with other similar organisations. 7.3 Assurance and effective accountability 7.3.1 Ensuring that recommendations for corrective action made by external audit are acted upon. 7.3.2 Ensuring an effective internal audit service with direct access to members is in place which provides assurance with regard to governance arrangements and recommendations are acted upon. 7.3.3 Welcoming peer challenge, reviews and inspections from regulatory bodies and implementing recommendations. 7.3.4 Gaining assurance on risks associated with delivering services through third parties and that this is evidenced in the annual governance statement. 7.3.5 Ensuring that when working in partnership, arrangements for accountability are clear and that the need for wider public accountability has been recognised and met. Page 92 of 128
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Page 15 of 43 Appendix 2: Description of Evidence for Compliance Evidence Description Principles Code of Conduct for Employees The various codes of conduct determine how officers and members work within partnerships, and the shared values that they will demonstrate. The Code of Conduct for Employees is available on the intranet and is also issued to new employees when they join Renfrewshire Council. The council’s disciplinary procedures are in place to deal with any alleged misconduct. 1.1.1 1.1.3 1.1.4 Code of Conduct for Elected Members The Councillors’ Code, which was introduced by the Ethical Standards in Public Life etc. (Scotland) Act 2000, sets out a protocol for relations between Councillors and employees. All Elected Members, following their election in May 2022, have signed their declaration of acceptance of office whereby they undertook to meet the requirements of the Councillors’ code issued under the Ethical Standards in Public Life etc. (Scotland) Act 2000 in the performance of their functions as a Councillor. The Code of Conduct was updated by the Scottish Government in December 2021 and a paper outlining this was approved at Council in December 2021. Any alleged contraventions of the Ethical Standards in Public Life etc (Scotland) Act 2000 would be referred for investigation to the Commissioner for Ethical Standards in Public Life. And thereafter for consideration by the Standards Commission appointed by Scottish Ministers. Where a hearing involving a member of Renfrewshire Council has taken place, the outcome of this is reported to the Council. Since August 2009 all Council and Board agendas include an item in relation to declarations of interest. Briefings for Elected Members on their responsibilities under the Code of Conduct for Councillors are held regularly every year, conducted by the Head of Corporate Governance (last briefing Oct 2024). The induction programme for Members elected in 2022 included sessions on the roles and responsibilities of officers and Members. The Council’s protocol for relationships between political groups, Elected Members and officers sets out the rights and responsibilities of Councillors and political 1.1.1 1.1.2 1.1.3 1.1.4 1.2.1 1.2.2 5.2.1 Page 93 of 128
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Page 16 of 43 groups in the course of conducting Council business and provide good practice guidelines in relation to the multi-member ward issues. (updated Feb 2024) Councillors are advised of and can attend sessions delivered by the Standards Commission. Standards Commission updates and revised guidance are circulated to Members when issued by the Commission. Protocol for Relationships between Political Groups, Elected Members and Officers The Council’s elected member and inter-party protocols and protocol for member/ officer relations were reviewed and combined into one composite protocol which was approved by the Finance and Resources Policy Board on 12th November 2014. An updated version was approved by Council on 29 February 2024. Any alleged contraventions of the Ethical Standards in Public Life etc (Scotland) Act 2000 would be referred for investigation to the Commissioner for Ethical Standards in Public Life. And thereafter for consideration by the Standards Commission appointed by Scottish Ministers. Where a hearing involving a member of Renfrewshire Council has taken place, the outcome of this is reported to the Council. Since August 2009 all Council and Board agendas include an item in relation to declarations of interest. 1.1.1 1.1.2 1.2.1 5.2.1 Code of Corporate Governance The Council complies with this requirement through its adoption of the CIPFA Code of Corporate Governance and its annual reporting of compliance with the code. 1.1.1 6.3.4 Cross-Party Governance Group The Cross-Party Governance Group was established in 2023 and comprised one member from each of the four political parties and one member to represent the Independents. The agenda was set by the group members and made recommendations with a report on the activities of the group being considered at Council on 29 February 2024. One key recommendation was that the Protocol (referred to above) be updated and training be given to managers in respect of this. That recommendation was fully implemented. 1.1.1 2.2.1 5.2.1 Scheme of delegated functions The Council’s scheme of delegation ensures that decisions are made at the lowest or most local level consistent with the nature of the issues involved, with the exception of those powers which cannot be delegated or have been reserved to the Council. These functions have been delegated to Boards and committees, the Chief Executive, Directors and Heads of Service and other officers, including through statutory appointments of officers. The Scheme is changed to reflect any restructuring of Council services and transfer of functions between services. The Scheme was updated in October 2024. 1.1.1 1.3.1 1.3.2 1.3.4 2.1.2 5.2.2 Page 94 of 128
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Page 17 of 43 Our Values The Council’s values were launched in 2020. These are continually embedded across the organisation through our policies and our training and development programmes. Specific Training on Our Values is available on the council’s iLearn platform. Understanding and knowledge of the organisational values was tested through the Employee Survey in 2024. 1.1.3 1.2.2 2.1.1 Council Plan The Council Plan sets out the strategic priorities for the organisation. The current plan for 2022-2027 was approved by Council in September 2022 and the accompanying performance scorecard was approved by Leadership Board in November 2022. Progress on delivering on the priorities in the Council Plan is reported to the Leadership Board on a six-monthly basis; the most recent report was in December 2024. The Council Plan has five strategic outcomes with an additional overarching aim to improve outcomes for children and families. Services align their own service planning to these outcomes, providing clear linkages between operational activities and strategic goals. 1.1.3 2.1.1 3.1.1 3.1.2 3.1.3 4.2.4 Community Plan (Local Outcomes Improvement Plan) Renfrewshire’s Community Plan acts as the Local Outcomes Improvement Plan and was refreshed in 2022. It was informed by a strategic needs assessment and by findings from consultations undertaken with our communities. It sets out a clear vision for partnerships and for Renfrewshire and its people, as well as the key areas of priority and actions to be undertaken. Six monthly updates on progress with the Community Plan are reported to the Leadership Board; the most recent report was approved in September 2024. 1.1.3 2.1.1 2.2.2 3.1.2 5.1.3 Senior Officers’ Register of Interests The Council has a register of interests for Senior Officers. Information contained on the register is subject to Freedom of Information legislation. Chief Officers are contacted on an annual basis to update the register. Information from the register of senior officers’ interests was published for the first time in October 2016 on the Council’s website. Renfrewshire was the first Council in Scotland to publish information on the interests of its senior officers online. 1.1.4 1.2.1 1.2.3 Page 95 of 128
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Page 18 of 43 Code of Conduct on Gifts and Hospitality The Code of Conduct on Gifts and Hospitality applies to all council staff and provides a framework for deciding whether it is appropriate to accept gifts or hospitality from individuals, businesses or organisations who are, or wish to be, associated with the Council. It also sets out the requirements for reporting and recording any such offers. Should we say here it was updated recently? 1.1.4 1.2.1 1.2.2 1.2.3 1.2.4 Whistleblowing policy The Council’s Whistleblowing Policy was refreshed in early 2023 and approved by the Finance, Resources and Customer Services Policy Board on 9 February 2023. It provides a mechanism for staff to raise concerns about any potential malpractice, illegality, wrongdoing or serious failures of standard of work. 1.1.4 Complaints Handling Procedure Complaints handling guidance and procedures were reviewed and updated in 2024, and reflect the latest advice from the Scottish Public Service Ombudsman (SPSO). An Annual Complaints Report is presented to each year to the Audit Risk and Scrutiny Board. This includes a breakdown on number of complaints, how timeously we have responded to complainants and improvements made to complaints handling. A refreshed quality assurance process was introduced in 2024, with a cross- council panel assessing a random sample of complaints in line with SPSO quality assurance guidance. Feedback was provided to CMT and to Directors and the exercise will be carried out annually. Findings are also included in the annual report to elected members. Performance information on complaints handling is part of service-level and CMT performance reporting. 1.1.4 6.2.4 Elected Member Register of Interests Councillors hold public office under the law and must observe the rules of conduct stemming from the law, the Code of Conduct for Councillors and any guidance from the Standards Commission and the rules, standing orders and regulations of the Council. In addition, the Council has developed an inter-party protocol which highlights that Political Groups have the responsibility not to require individual Councillors to vote on party lines in respect of decisions where group decision- making would be unlawful, contrary to the Councillors’ Code of Conduct or against any Council approved guidance; in particular on planning applications, specific regulatory matters, employment issues affecting individuals, all matters coming 1.1.4 1.2.1 Page 96 of 128
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Page 19 of 43 before the Audit, Risk and Scrutiny Board or any matter which requires to be determined on the basis of evidence given to or the findings of a forum on which Councillors serve. Members are required to register their interests in terms of the Code of Conduct for Councillors’ and declare these interests at meetings. Declarations of interest are minuted and are available for public view on each member’s online profile page on the website. Elected Members are formally asked to regularly update their register of interests every six months. Provision of ethical awareness training The elected member induction programme includes a session which covers the code of conduct, protocols, roles and responsibilities, and the role of the Standards Commission. Elected members can also access resources directly from the Standards Commission. Standards Commission updates and revised guidance are circulated to Members when issued by the Commission. 1.2.2 Appraisal processes All HR processes are currently being considered as part of an ongoing programme of review and development, with new/updatedpolicies being brought forward regularly. A new People, Performance and Wellbeing Policy was approved by Council in 2024, which replaced the People, Performance and Talent Policy. The new policy provides a focus on improving how we manage and support the performance, development, and the wellbeing of our people. It now aligns a key principle from the Health and Wellbeing Plan where managers will now be trained and supported on managing wellbeing matters, including trauma awareness to better understand how their support can positively impact on performance, development and health and wellbeing. Performance will be supported and managed by having structured ‘quality 1-2-1 conversations’ with at least one yearly conversation as a minimum being held between managers and their people to set performance standards and expectations. New guidance and associated training is due to be rolled out across the workforce early 2025. Competency Frameworks for all levels are available across the Council. An interim 2024 Appraisal Process is being adopted for our Chief Officers whilst the review of existing processes is ongoing. 1.2.3 5.2.7 Recruitment The Council has robust recruitment procedures in place to ensure the fair selection of candidates. There is an appointment panel for Chief Officer level appointments. The Council’s recruitment and selection processes are designed in accordance with best practice principles, legislation and COSLA recruitment and selection 1.2.3 Page 97 of 128
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Page 20 of 43 guidance. A revised Recruitment Policy was approved by the Finance, Resources and Customer Services Policy Board in November 2022. Work is underway on a Workforce Planning Strategy which will support staff retention as well as recruitment. Standing Orders relating to contracts The Council has a statutory obligation to have standing orders in place relating to contracts, the main purpose of which is to provide open and transparent procedures for tenderers; to achieve value for money for the Council; and to provide guidelines for officers. These standing orders are reviewed regularly as a matter of good practice; the most recent version took effect on 1 January 2024. Organisations bidding for Renfrewshire Council contracts are required to complete a Single Procurement Document (SPD), a standard questionnaire, as a self- declaration that they have not breached any of the mandatory and discretionary exclusion grounds set out in the Procurement Regulations. Bidders are also required to complete and submit an Equalities Questionnaire, setting out their Equalities policies and to confirm that they fully comply with their statutory duties under the Equalities Act 2010. To help support small businesses, bidders must also sign an undertaking to pay their sub-contractors within 30 days of receipt of a valid invoice. To protect the workforce, bidders are required to respond to a number of scored and evaluated questions which assess the organisations approach to Fair Work with consideration given to the Fair Work First criteria. Construction Contracts include a statement in relation to the procurement of construction contracts which links directly to the Council’s Construction Charter. All of these measures seek to ensure that the appointed contractor is a fit and proper organisation, that their workforce is protected and that the use of exploitative labour is forbidden. 1.2.3 1.2.4 1.3.1 1.3.2 1.3.4 Procedural Standing Orders The Council's Procedural Standing Orders govern the conduct of meetings of the Council and its Boards. The Standing Orders provide for such matters including voting, motions and amendments and the power of the Provost/Chair. 1.3.1 1.3.2 1.3.4 Policy Board Reports Reports to the Council and all Board meetings provide members with sufficient information on which they are able to take reasoned decisions and provide clear recommendations. Decisions made during meetings are recorded in the minutes. 1.3.1 1.3.2 1.3.4 Page 98 of 128
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Page 21 of 43 Report templates include mandatory sections where the implications of reports must be noted. Pre-agenda meetings are held with Convenors and Depute Convenors at which any issues can be addressed prior to the finalised agenda being issued. In addition, each of the Council Boards has a dedicated solicitor who reviews reports in order that the vires of proposed actions can be checked. Each report has a section on legal implications. The frontispieces to reports require that community planning partners are consulted in the preparation of reports where appropriate and reports must outline community/ Council plan implications. 2.1.3 3.2.2 4.1.1 6.2.2 Statutory Officers Role The Council has nominated officers fulfilling statutory roles: • Head of Paid Service • Chief Finance Officer (CFO) (proper officer in terms of s95 of the Local Government (Scotland) Act 1973) • Monitoring Officer (1.3.4) • Senior Information Risk Owner (SIRO) • Chief Social Work Officer • Data Protection Officer (6.4.1) • Chief Planning Officer The Chief Executive is the Head of Paid Service. The Director of Finance is both the CFO and the SIRO. The Head of Corporate Governance acts as Monitoring Officer in terms of the Local Government and Housing Act 1989 and as detailed in the job description, is responsible for advising the Council on the legality of its decisions and providing guidance to Councillors and officers on the Council’s powers. The Head of Child Care and Criminal Justice is the Chief Social Work Officer, and fulfils that role for the Council and for Renfrewshire Health and Social Care Partnership. 1.3.1 1.3.4 6.4.1 Page 99 of 128
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Page 22 of 43 The Managing Solicitor (DPO) is the statutory Data Protection Officer whose remit includes overseeing the Council’s implementation of GDPR, other data protection laws and the relevant Council policies and to ensure compliance with those. Promotion of the Community Empowerment (Scotland) Act 2015 The Council has promoted awareness of the powers and potential use of the Community Empowerment Act through engagement with statutory and non- statutory community organisations and with third sector partners. The Council initially published details of the legal and procedural framework in relation to Community Asset Transfer in February 2017 and revised the policy and procedures in 2022. The Council reports information to the Scottish Government each year in relation to the Act including in relation to community asset transfers or participations requests. An annual report on community planning activities is prepared and published in line with the Act. 1.3.3 Renfrewshire Forum for Empowering Communities The Renfrewshire Forum for Empowering Communities is part of the local Community Planning structure. It is run by Engage Renfrewshire, the local Third Sector Interface organisation. Membership is drawn from third sector groups and community councils, as well as from local public sector bodies. The Forum is intended to act as a community sounding board for the Community Planning Partnership. 2.1.4 2.3.3 4.2.2 Community Planning Arrangements Renfrewshire Community Planning Partnership includes a range of organisations working in Renfrewshire— Renfrewshire Council; Police Scotland; the NHS; Scottish Fire and Rescue, West College Scotland, University of West of Scotland, Scottish Enterprise, One Ren, the Third Sector Interface called Engage Renfrewshire, Skills Development Scotland, Renfrewshire Health and Social Care Partnership and the Department of Work and Pensions. The Partnership is led by an Executive Group chaired by the Council’s Chief Executive 2.2.1 2.2.2 2.2.3 Petitions Board The Petitions Board provides an opportunity for individual members of the public to raise issues of concern with the Council, either as individuals or on behalf of an organisation. The Council introduced a public petitions procedure in 2007 which strengthens the connection between the Council and the community to raise issues of concern in relation to services provided by the Council or other bodies such as the police and health board, recognising that the Council has limited influence over other bodies. 2.3.1 4.1.2 Page 100 of 128
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Page 23 of 43 Details of petitions received and their outcomes are included in the annual report to the Board and on the Council’s website. Petitions previously were considered by the Audit, Scrutiny and Petitions Board but as of June 2017, a separate Petitions Board has been established to consider petitions only. The Board met twice in 2024, to consider petitions on proposed service changes by the HSCP, safe travel to school in Elderslie, Headstones in Cemeteries and speed limits on Bridge of Weir Road.. Local Partnerships Renfrewshire has seven Local Partnerships, created in 2019 to replace the previous Local Area Committee structure. It was intended to review arrangements after twelve months but this was delayed due to the pandemic and a subsequent need to prioritise other work. The review is now complete and recommendations were approved by the Leadership Board in February 2024 to strengthen the Local Partnerships and take forward the next phase of their development. 2.3.3 Community engagement mechanisms Formal mechanisms, such including the Community Planning Partnership’s Forum for Empowering Communities, are one way in which community groups can contribute to local priority setting. The Renfrewshire Climate Panel and the Fairer Renfrewshire Lived Experience panel have more focused remits and allow local residents with particular interests and/or experiences to inform decision-making. The approaches to participatory budgeting detailed elsewhere in this report are an opportunity for individuals to directly influence spend in their community, and have a wider reach than the more formal groups noted above. The Council also undertakes public consultations and has established a Customer Feedback group, which is open to any resident to join. The Council’s new Consultation and Engagement Policy, approved by Leadership Board in February 2025 will provide additional co-ordination, oversight and consistency of approach to consultation and engagement activities. 2.3.5 Policy Board Implications All policy board papers have an implications section requiring the report author to detail implications under these headings: Financial, HR and Organisational Development, Community/Council Planning, Legal, Property/Assets, ICT, Equality and Human Rights, Health and Safety, Procurement, Risk, Privacy Impact, COSLA 2.2.1 3.2.1 Page 101 of 128
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Page 24 of 43 Position, Climate and Children’s Rights. Report authors should use this section to note impacts arising from the recommendations of the report. Renfrewshire’s Plan for Net Zero Renfrewshire’s Plan for Net Zero was approved by elected members in 2022 and sets out how the Council intends to become a net zero organisation and how it will work in partnership with communities, businesses and other organisations to make Renfrewshire as a whole net zero. Regular two-way engagement on the strategy and support for decision making comes from the Renfrewshire Climate Panel, recruited from the local community. The Council continues to make progress with its aspirations of working towards net zero by 2030. The focus of efforts in recent months and future years will be around heat and fleet. The Sustainable travel programme has been relaunched with an aim to reduce business travel by at least 20%. A new Local Heat and Energy Efficiency Strategy and Delivery Plan has been approved by elected members. The Council are also in the process of developing two Outline Business Cases for District Heating Networks in Paisley to provide cleaner energy to businesses and residents in the surrounding areas, particularly helping to address fuel poverty in one of the most deprived areas of Paisley. 2.3.3 2.3.4 2.3.6 Service Improvement Plans Each service prepares annual service plans which set out priority actions for the forthcoming three-year period, and provide performance measures and actions to demonstrate improved outcomes. These plans align to the Council Plan. Plans are approved by the relevant Policy Board and those boards receive updates on progress twice a year. 3.1.1 3.1.2 3.1.3 3.1.5 4.2.1 4.2.5 4.3.4 6.2.1 6.2.4 6.4.3 Operational Performance Reports Elected members receive operational performance reports each board cycle. These include reports on customer services, business services and facilities management provided to the Finance, Resources and Customer Services Policy Board, and a service update from Environment, Housing and Infrastructure to the Infrastructure, Land and Environment Policy Board. 6.2.4 Capital Programme/Capital Investment Strategy The Council’s capital spending plans are policy-led and therefore reflect the main strategic intent of the Council and comply with the Prudential Framework for Capital Investment. Full Council approves the five-year rolling programme as part 3.2.1 Page 102 of 128
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Page 25 of 43 of the annual revenue and capital budget-setting process. Updates on the progress of capital investment plans are reported on a routine basis to each Policy Board. Annual Governance Statement The Council complies with this requirement through its Annual Governance statement which details the organisation’s governance arrangements. This is in line with national guidance and is updated on an annual basis. The statement is approved by the Audit, Risk and Scrutiny Board in advance of its publication in the Council’s Annual Accounts. Our Business as Usual risk assessment is a key piece of evidence for assurance. Each Head of Service completes 12 risk assessments annually matched to key areas of governance. Any key risks identified through the Business as Usual Risk Assessment process, which is undertaken by the Directors and Heads of Service, would be reflected in the governance statement. 6.3.4 7.2.3 7.2.4 7.3.4 Access to services The Council aims to make its services accessible to all, and to make reasonable adjustments as necessary to ensure all residents have fair access. All Council documents can be provided in differing formats and languages in order to meet any communication needs. In recent years, the Council has introduced a wider range of digital services, allowing customers to request services online at a time that suits them. For those who prefer face-to-face or telephone contact, these options are still available. The Council has contracts with local independent advocacy groups who can support people with specific needs to access services. The Council has also worked with partners as part of service review or improvement activities to consider barriers to access. For example, our work in terms of digital inclusion has been recognised in a recent Audit Scotland report as demonstrating very positive practice. 3.2.4 Accountability and partnership arrangements – Arrangements are in place between Renfrewshire Council and its Community Planning partners, the IJB and OneRen. 7.3.5 Page 103 of 128
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Page 26 of 43 Integration Joint Board and OneRen Governance arrangements, such as systems for managing, monitoring and scrutinising the IJB’s business and finances have been developed. Effective arrangements are in place for sharing information between partners that can lead to improving how services are provided, such as the Community Safety Partnership. The Head of Policy and Partnerships is the One Ren Monitoring Officer and undertakes quarterly meetings to review performance of OneRen (formerly Renfrewshire Leisure). In addition, six-monthly updates and an Annual Business Plan is reported to and agreed by the Leadership Board. The Head of Policy and Partnerships and the Head of Corporate Finance and Procurement are also Council observers on the One Ren Board. Self-assessment A core value of Renfrewshire Council is ‘We Value Learning’ and the Council has established an ongoing programme of self-assessment to learn and improve. This helps to ensure that all elements of Best Value are being delivered and to drive forward corporate improvement activities in line with our commitment to continuous improvement as an organisation. Within the new Best Value approach, our first phase of self-evaluation focused on a Corporate Self-Assessment which was rolled out in 2022/23 and 2023/24 and resulted in the development of Corporate Improvement Plan (CIP). This CIP has been enhanced with additional areas for improvement identified via the ongoing external audit processes, including our annual audit report and the thematic reviews led by our external auditors. Progress against this was reported to Leadership Board on 19 February 2025. In December 2024, Renfrewshire Council launched an innovative new approach to self-assessment focused on organisational culture, known as Renfrewshire’s Cultural Assurance Model (CAM). The CAM is a first of its kind within the Scottish public sector and was developed in partnership with the Improvement Service and based on the Public Service Improvement Framework which has been used in Renfrewshire Council for over 15 years. Updates on this programme will be provided as this develops. 7.3.4 Minutes of Agreement Minutes of Agreement set out the rights, duties, powers, liabilities and obligations of parties to the Agreement e.g. the Council and partner organisations. Appointments of members to outside bodies are not taken up until the Director of 4.2.3 Page 104 of 128
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Page 27 of 43 Finance and Resources confirms that the organisation has appropriate insurance policies in place. Benchmarking / peer review Services across the Council are involved in both formal and informal benchmarking arrangements through for example, the Association for Public Sector Excellence and the Scottish Housing Best Value Network (SHBVN) annual benchmarking process. All 32 Scottish local authorities use the Local Government Benchmarking Framework as a means of peer review, and to contribute to their Statutory Performance reporting obligations. The Council’s performance in terms of Local Government Benchmarking Framework indicators is reported to and reviewed by the Audit, Risk and Scrutiny Board each year. This includes information on service levels, service costs and customer satisfaction. Service level benchmarking may also be undertaken in relation to specific areas of performance including in relation to educational attainment, procurement or in relation to specific service review exercises. 4.2.6 5.1.2 7.3.3 Audit, Risk and Scrutiny Board The Audit, Risk and Scrutiny Board functions as the Council’s audit committee and has an overview of the internal audit role to ensure that resources are being targeted effectively. The Council has undertaken a review of the effectiveness of the Board against the CIPFA Good Practice Guidance for Audit Committees and all actions from this review been completed. Member Training Sessions on relevant topics are now undertaken regularly. The Board considers summaries and risks identified from the work of internal audit and considers the Chief Auditors annual opinion on the effectiveness of the Council's governance, internal control and management of risk. Recommendations made by external audit and/or national external audit reports along with management’s response and/or Renfrewshire Council’s position are reported to the Audit, Risk and Scrutiny Board. The Audit, Risk and Scrutiny Board’s remit includes audit scrutiny, monitoring and review of service delivery, performance, policies and practice, community leadership through monitoring of other public bodies, and standards and ethics. In terms of the Public Sector Internal Audit Standards, the Council’s Chief Auditor submits quarterly reports on internal audit performance and an annual report to the Audit, Risk and Scrutiny Board on the activities of internal audit to demonstrate 5.1.1 5.2.7 6.2.3 6.2.4 6.3.1 6.3.5 6.4.3 7.2.1 7.3.1 7.3.2 Page 105 of 128
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Page 28 of 43 performance and containing a view on the overall adequacy and effectiveness of the Council’s framework of governance, risk management and control. Again, in terms of the above standards, regular reports are submitted to the Audit, Risk and Scrutiny Board in relation to the findings of the Council’s internal and external auditors which details the main issues arising. New Global Internal Audit Standards in the Public Sector have been issued which the Council will implement throughout 2024/25. The Council’s performance in terms of Local Government Benchmarking Framework Indicators is reported to and reviewed by the Audit, Risk and Scrutiny Board each year. This includes information on service levels, service costs and customer satisfaction. In addition, the Annual Complaints Report is presented to Board annually. This includes a breakdown on number of complaints, how timeously we have responded to complainants and improvements made to complaints handling. The Audit, Risk and Scrutiny Board prepares an annual programme, including areas for specific review. Members suggesting an area for review must identify the purpose and objectives of the review and the intended outcome. The Board takes a common sense approach to reviewing decisions and policies and the process provides the opportunity for Elected Members to examine the various functions of the Council, to ask questions on how decisions have been made, to consider whether service improvements can be put in place and makes recommendations as appropriate. For each review, the Chief Executive appoints a lead officer to assist members of the Board to identify potential issues and questions to be asked of witnesses. Following each review, a report is prepared by the lead officers for approval by the Board and thereafter the Council. If appropriate, minority of dissenting views are recorded in the minutes of the meeting. Procurement – delivering sustainability and social value Section 9 of the Procurement Reform (Scotland) Act 2014 places a duty on public sector contracting authorities to consider how their procurement activities can: i. improve the economic, social, and environmental wellbeing of the authority’s area, ii. facilitate the involvement of small and medium enterprises, third sector bodies and supported businesses in the process, and 2.3.6 4.3.4 Page 106 of 128
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Page 29 of 43 iii. promote innovation In accordance with the requirements of the Act, the Council has set out how we will ensure delivery of these ambitions in our Procurement Strategy, which covers the period 2023 to 2025. It sets out our commitment to balance cost, value, the delivery of social value, the delivery of supply chain and supplier sustainability, and the need to tackle climate change. Procurement and Economic Development are working jointly to deliver support to local suppliers as part of our Community Wealth Building approach. Our procurement activity also delivers community benefits within contracts; 114 identified benefits were delivered in 2023/24, including 11 new jobs, 5 new apprenticeships and 8 new qualifications. Relevant tenders are evaluated according to the Fair Work criteria. The strategy also notes the key enabling role of procurement in working towards a Net Zero Renfrewshire by 2030. Corporate Asset Register The Council maintains a Corporate Asset Register and this is reviewed regularly. On-going discussions across the Council to ensure all key assets (as defined under CIPFA guidance – Roads, Fleet, Property ICT and Open Space) are covered and regularly reviewed. In specific relations to Property, work is being undertaken with regards to a Strategic Property Review with data gathered and assets rationalised where possible. Work has (and will continue) in regard to Condition Surveys with a full review of learning estate undertaken in 2024 as part of the Core Facts return to the Scottish Government. Reviews across the Council (OneRen/Commercial Property/HSCP) will all feed into the Asset Management and an Asset Management Oversight Board has been established to take a strategic approach to Property in particular. 5.1.1 Community Asset Transfer Policy The Council’s Community Asset Transfer was revised in 2022. The policy, guidance and documents relating to asset transfers can all be found on the Council’s website. 5.1.1 Page 107 of 128
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Page 30 of 43 Meetings between Chief Executive and senior elected members The Chief Executive holds weekly meetings with the Leader and regular meetings with opposition leaders. 5.2.1 Cross Party Sounding Board The Council at its statutory meeting in May 2017 established a Cross Party Sounding Board. as part of its decision-making structure. The remit of which is to act as a sounding board and discussion forum, with no decision-making powers: to provide an opportunity to discuss matters of common interest or of Council wide relevance. The Board has a membership of six – the Leader and Depute Leader, the leaders of the three opposition political groups, and a representative of the independent members. 5.2.1 Local Development Plan Member-Officer Group A new cross-party working group has been set up to support the development of Renfrewshire’s new Local Development Plan (LDP). This is a new approach for Renfrewshire and demonstrates the Council’s ongoing commitment to working closely and effectively with elected members and also the commitment to cross- party working. 5.2.1 Division of leadership roles – paid service and elected representation The Chief Executive has responsibility as head of the paid service for all aspects of operational management. He leads on the implementation of decisions taken by elected members through full Council and the board structure. He has overall responsibility for managing service delivery, with clear lines of accountability throughout the senior management structure. The Leader of the Council has responsibility for forming an administration and enabling democratically-accountable decision-making. The Chief Executive and the Leader of the Council meet weekly. 5.2.3 HR and OD Policies Throughout 2024, the Council presented revised HR policies to the board which included Menopause Support, People, Performance and Wellbeing and the Disciplinary policy. The revised Parenting Leave and Pay Policy was presented to board in February 2025, with Equality and Diversity and Respect at Work expected to follow before the summer. 5.2.8 Health and Safety Plans The current Corporate Health and Safety Policy has been reviewed and is due to be presented to the Finance, Resources and Customer Services Policy Board by the summer of 2025. The Council’s annual Health and Safety progress report was 5.2.8 Page 108 of 128
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Page 31 of 43 presented to members at the Finance, Resources and Customer Services Policy Board in June 2024, and the most recent update was in November 2024 Each service also has its own Health and Safety Plan and working group. Health and Safety reports for each service are presented to policy boards annually, with a progress report after six months. . SPI Direction Audit Scotland published a revised SPI Direction in December 2024. This sets out the requirements of monitoring and reporting information by Councils, and each iteration applies for three years. Councils are required to report on performance in a way that is balanced, timely and accessible. Performance reporting should show how Councils are delivering on their strategic priorities, how performance making informs decision-making, how Community Planning priorities are being delivered, and how Best Value is being demonstrated. The Direction takes effect from 1 April 2025 and covers performance reporting from 2025/26 onward. 6.4.3 Council’s Approach to Performance Management and Reporting The Council’s approach to performance management and reporting, both internally and externally, demonstrate compliance with multiple elements of the code of corporate governance. Our approach can be split into the following elements: • Scrutiny by elected members • Scrutiny by Corporate Management Team • Scrutiny by senior managers in each service • Public performance reporting • Scrutiny by external bodies • Performance management systems The Council Plan and its associated action plan and performance scorecard are one of the ways in which elected members can scrutinise performance against the strategic priorities of the Council (4.2.5; 5.1.1; 5.2.4). Progress reports are presented to the Leadership Board twice a year. Members also receive progress updates on the Community Plan. The Corporate Management Team (CMT) scrutinise the Council Plan scorecard and every quarter (5.2.4; 6.2.4; 6.4.3; 7.2.2), Each quarter, an aspect of performance is identified as a ‘deep dive’ area and more detailed information is brought back to CMT by the relevant Head of Service. Areas for improvement and strength have been self-assessed by the CMT in early 2025. 2.1.1 4.2.5 4.2.6 5.1.1 5.2.4 5.2.7 6.2.4 6.4.3 7.1.1 7.1.2 7.2.1 7.2.2 Page 109 of 128
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Page 32 of 43 Each council service produces a Service Improvement Plan (4.2.5; 5.1.1; 5.2.4) which sets out how they will contribute to the delivery of the Council Plan and how they will measure their contribution and performance. As well as allowing senior managers to track the performance of their service, this approach allows for elected member scrutiny; progress on service improvement plans is reported through policy boards every six months. Services also participate in a scrutiny exercise every six months, led by the Chief Executive and supported by a peer Director Members also receive reports on operational performance, on corporate performance on complaints and on the Local Government Benchmarking Framework. (5.1.1; 6.4.3; 7.2.2). Public performance reporting (2.1.1; 7.1.1;7.1.2;7.2.1) is undertaken in the interests of transparency; it allows local residents, businesses and partner organisations to track the Council’s performance over time. Service- and Council- level performance reports are available online through the agendas and minutes of public meetings but the Council also produces an annual report which is available as a storymap on the Council’s website. This format allows for comparison with other councils on measures included in the Local Government Benchmarking Framework. Performance data is accompanied by case studies which demonstrate the difference services are making to Renfrewshire. To ensure consistency and provide an audit trail, all performance indicators are collected, recorded and tracked using the Pentana performance management system (5.1.1). What about the updated guidance you circulated? Council’s approach to risk management The Council has a well-established and robust approach to risk management which includes ‘Risk Matters’, the Council’s combined risk management policy and strategy. (3.1.4; 6.1.1; 6.3.1). It is refreshed every two years; the latest version was approved by the Audit, Risk and Scrutiny Board in November 2023. Risk Matters is explicit regarding the Council’s risk management philosophy and regarding members’ and managers’ responsibility for risk management. The Strategic Risk Management Development Plan (6.1.1) underpins Risk Matters. It 3.1.4 6.1.1 6.1.2 6.1.3 6.3.1 6.3.2 6.5.2 Page 110 of 128
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Page 33 of 43 reflects the development work required to fulfil the objectives in Risk Matters, and is refreshed every two years. The Council maintains, monitors and reviews its corporate and strategic risk registers in line with the strategy (6.1.2; 6.3.2), and presents these every six months to the Audit, Risk & Scrutiny Board along with an annual report on health of the Council’s risk management arrangements. Since 2023/24, the Council has implemented a new approach to reviewing ‘business as usual’ risks on a thematic basis. Each Head of Service reviews the 12 thematic areas over the course of a year and confirms the level of assurance for their service area against each theme. This then informs Internal Audit’s overall level of assurance. The Council’s Risk Manager is supported by the Corporate Risk Management Group (CRMG) (6.1.2), which comprises representatives from each council service as well as specialists on particular areas of risk. This group meets regularly to discuss matters of common interest, to share learning and to co-ordinate review of and deep dives into risks and reporting to CMT and Board. The CRMG oversees the ongoing development, monitoring and review of the corporate risk management register arrangements and facilitates an escalation process whereby risk can be moved between corporate, business as usual or service level. In 2024, the Council commissioned Willis Towers Watson to undertake an independent review of our risk management approach. The very positive report noted that “‘Renfrewshire Council has a well-established approach to risk management with many positive features, especially in terms of strong governance and positive cultural attitude towards risk management at a corporate level. The BAURAM (Business-as-usual risk assurance model © Renfrewshire Council) is an innovative and powerful approach which has been designed well and, like many other elements of Renfrewshire Council’s risk approach, is evidently subject to continuous improvement.” The Council is currently considering the recommendations from the review. There are extensive risk management training and development opportunities available to all council officers; both online and in person courses covering an introduction to risk management, insurance matters relating to procurement, and risk psychology and decision-making. Page 111 of 128
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Page 34 of 43 Financial risk is included as part of the Corporate Risk Register to ensure financial management is managed and reviewed on a regular basis. (6.5.2) The Programme Management Unit ensure that risk assessment, monitoring and mitigation is a key part of any project and programme governance they support. Council’s approach to information governance The corporate approach to information governance provides assurance in relation to how sensitive data is managed and stored across the organisation. Key elements are: • Information Governance Strategy and Framework • Council Data-Sharing Code and individual data-sharing and data- processing agreements • Information Governance Team • Data protection policies and procedures • Information Governance Learning and Development Strategy • Internal and external audits The Council has a Data Sharing Code, based on the ICO Code, which was updated in December 2021. (6.4.2). Where data is being shared, appropriate data- sharing and/or data-processing agreements are in place and these are held in a central repository (6.4.2). These agreements specify security requirements. The Managing Solicitor (DPO) reports monitoring figures to the Senior Information Risk Owner (SIRO) on a monthly basis, and to CMT annually (6.4.1). The Council is subject to routine external audit by the Information Commissioner’s Office (ICO) as well as internal audit. (6.4.1) There are clear procedures in place for reporting any data breach, however minor, and mandatory training is in place for any staff who work with data. Such staff are required to undertake refresher training on an annual basis. The Council’s Data Protection Policy was revised and approved by the Finance, Resources and Customer Services Policy Board in September 2024. 1.2.4 6.4.1 6.4.2 Page 112 of 128
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Page 35 of 43 Council’s Approach to Cyber Security The Council has extensive cyber security arrangements in place to minimise the risk of malicious acts which could impact information security and service delivery. Details of these are not provided in any public documents for security reasons. 4.2.4 5.1.1 5.2.4 6.1.2 Elected Member Training and Development The CPD framework for Councillors was developed by the Improvement Service and all members have access to it. Members are encouraged to assess their own development needs and develop a personal development plan. Using the Improvement Service CPD framework, Councillors can opt to undertake a 360° peer review of their performance as an Elected Member. (5.2.6) In Renfrewshire, focused development for Elected Members takes place regularly through a programme of development events and opportunities is issued to members on a monthly basis. As 2022 was an election year, a comprehensive induction package was delivered for newly-elected and returning members. The members’ development programme provides members with briefings as soon as practicable when new legislation is introduced, e.g. the General Data Protection Regulation. Members who are involved in taking quasi-judicial decisions, e.g. planning, licensing, are briefed regularly on their responsibilities. Members who sit on the Licensing Board must undertake and pass a mandatory training course. There is a training programme in place for members of the Audit, Risk and Scrutiny Board and the Chief Auditor proves a regular briefing programme for Board members, to assist them in fulfilling the audit committee role. To reduce the reporting of routine operational matters to policy boards and to allow Boards to focus on policy issues, a range of matters including the exercise of delegated authority by officers are reported to Members by means of a regular bulletin rather than a formal report to a Policy Board (2.1.2). Following a recommendation by the Cross Party Working Group, with a view to raising its profile, the briefing is now issued with the agenda for Full Council Meetings Members have also been provided with briefings specifically focused on the Council’s response to the pandemic as required. An annual record of elected member training is available online after the end of each financial year. 1.2.2 2.1.2 5.2.1 5.2.4 5.2.6 5.2.7 Page 113 of 128
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Page 36 of 43 Transparency of Council meetings Meetings of the full Council, of Policy Boards, Policy Board sub-committees and the Audit, Risk and Scrutiny Board are all open to the public, unless there is a valid reason under the terms of the Local Government (Scotland) Act 1973 to exclude the press and public from all or part of the meeting. Where a recommendation is made for a matter to be held in private, the reason for this will be identified in the agenda and in the minutes of the meeting. These meetings are also webcast live and the recordings retained and made available via the Council’s website for anyone who wishes to view them. Meetings can be conducted fully in-person, fully online or as a hybrid. The timetable for these meetings is published well in advance (meetings are currently timetabled until the end of 2025) and the agenda and papers are available online several days’ prior to the meeting taking place. Only those items which contain exempt or confidential information will not be shared publicly. 2.1.1 2.1.2 2.1.3 3.2.3 4.1.1 4.2.1 6.2.2 Staff Training and Development Staff are able to access professional training courses if required to enable them to carry out specific roles This includes in person classroom style training or elearning. The ‘Our People Our Future 2021-26’ strategy was approved by the Finance, Resources and Customer Services Policy Board in March 2021 and replaces the Organisational Development Strategy and Workforce Plans. A further update was approved by the Finance, Resources and Customer Services Policy Board in September 2023. It makes a commitment to investing in the workforce to ensure people are supported and equipped with the right skills to deliver on the council’s ambitious outcomes for Renfrewshire. The Strategy offers a more flexible approach and will be owned by and embedded within services and is fully aligned with their needs. The most recent progress report was submitted to members at the November 2024 Finance, Resources and Customer Services Policy Board. Regular reports on implementation, including new and revised policies, are considered at the Finance, Resources and Customer Services Policy Board. The Council’s online learning platform, which has recently been refreshed, has a wide range of e-learning modules available to employees to support their learning and development. It includes an induction programme for new employees and a 1.3.2 5.1.4 5.2.4 Page 114 of 128
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Page 37 of 43 number of mandatory courses on areas such as data protection/information security. It also includes a range of courses suitable for aspiring and current managers. The new system will continue to evolve throughout 2025 along with new and revised content being added for learners. In 2023, a programme of leadership development for senior management was launched and completed for Chief Officers in conjunction with our partners at SOLACE. The programme was revised and then rolled out to the next tier of senior managers across the Council throughout 2024. The Council’s management development programme, Lead to Succeed, has three levels (Inspire, Influence, Impact) which provide training for aspiring and current managers at all levels of the organisation. The training is linked to a CMI qualification. Internal Audit function The Council’s Internal Audit Charter sets out the authority, responsibility independence and reporting lines for internal audit activities (1.3.4; 6.3.4). The outcomes of internal audit reviews (5.1.1) are reported to Audit, Risk and Scrutiny, providing overall assurance rating and the number of recommendations in each risk category for these reviews. The committee summary for each report, is also provided. For each audit assignment where recommendations have been made, an action plan is put in place to address these and the management summary submitted to Board includes a management comment detailing how the implementation of the audit recommendations are progressing. In terms of the Public Sector Internal Audit Standards (6.3.1; 7.3.2), the Council’s Chief Auditor submits quarterly reports on internal audit performance and an annual report to the Audit, Risk and Scrutiny Board on the activities of internal audit to demonstrate performance and containing a view on the overall adequacy and effectiveness of the Council’s framework of governance, risk management and control. Again, in terms of the above standards, regular reports are submitted to the Audit, Risk and Scrutiny Board in relation to the findings of the Council’s internal and external auditors which details the main issues arising. New Global Internal Audit Standards in the Public Sector have been issued which the Council will implement throughout 2024/25. 1.3.4 1.3.5 5.1.1 6.3.1 6.3.3 6.3.4 7.3.2 Page 115 of 128
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Page 38 of 43 The findings of any internal audit investigations are reported to the Audit, Risk and Scrutiny Board as they arise. For security reasons, these reports are marked exempt and not publicly available. Consultation and engagement mechanisms The Council’s Consultations page on the website provides links to all active consultations and surveys, which are open to all residents to participate in. Our Feedback Database is open to any resident to join and invites views on new processes on an ad hoc basis. A new Consultation and Engagement Policy was approved by the Leadership Board in February 2025. The new policy introduces additional co-ordination and oversight of all engagement activity and provides all staff with a toolkit to support high-quality engagement. A new consultation hub on the website is being developed to support the roll out of the new policy. There are theme/service specific opportunities to engage with the Council. Tenants’ and Residents’ Associations provide a mechanism for engaging with the Council on housing issues. The Climate Panel meet regularly to discuss local priorities for Net Zero by 2030. The Fairer Renfrewshire Lived Experience Panel help inform work on tackling inequalities. Our participatory budgeting work – noted elsewhere – also provides opportunities for communities to directly contribute to decisions. A range of strategic and service level consultations take place throughout any period – some of these may be prescribed through statutory guidance. 2.1.4 2.3.1 2.3.3 2.3.4 3.2.3 4.1.2 5.2.5 Counter-fraud measures The Council has a strategy for the prevention and detection of fraud and corruption, which was revised in 2024 and approved by the Finance, Resources and Customer Services Policy Board. . Any matters coming to light are investigated by Internal Audit or Counter-Fraud. The Audit, Risk and Scrutiny Board receives regular reports detailing such investigations (these reports are exempt under the terms of the Local Government (Scotland) Act 1973). An Anti-Money Laundering Policy was introduced in June 2017, which has been revised and approved by the Finance, Resources and Customer Services Policy Board in February 2025. 1.3.5 6.3.3 Page 116 of 128
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Page 39 of 43 External scrutiny The Council is independently evaluated by bodies such as the Care Inspectorate, Education Scotland, the Accounts Commission and the Scottish Public Services Ombudsman (who considers complaints against the Council). These bodies publish scrutiny reports etc on their websites. Accounts Commission scrutiny is reported to the Audit, Risk and Scrutiny Board (and /or full Council as appropriate). School inspections are reported to the Education and Children’s Services Policy Board. Care Inspectorate reports which include any gradings of Adequate or below are reported to the Education and Children’s Services Board. Inspections of community learning and development are reported to the Communities and Housing Policy Board. Partnership services for children at risk of harm were inspected during 2024 received a very positive report from the Care Inspectorate. In November 2024, Renfrewshire Council and Renfrewshire HSCP were notified of a joint inspection of adult support and protection arrangements across the partnership area. Fieldwork began in December 2024 and concluded in February 2025. The final report is expected in mid-March 2025. The Council’s Best Value audit will take place in early 2025. Audit Scotland’s programme of annual thematic audits of all councils focused on workforce planning in 2024 and will look at transformation in 2025. 7.3.3 Communications The Council communicates with members of the community and its stakeholders (and vice versa) through several mechanisms including: • Tenant Forums • Community Planning Groups • Community Councils • Local Partnerships • Council Website • Complaints procedure • Public Performance reports • Customer Service Channels • Local media 2.2.1 2.3.2 4.2.2 Page 117 of 128
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Page 40 of 43 • Online channels (such as social media, newsletters) and a range of paid for printed materials A Marketing and Communications Strategy and Internal Communications Strategy was developed and approved by the Corporate Management Team in 2024. The strategy outlines a number of methods to continue to improve internal and external communications across the Council. Communication is everyone’s responsibility and a fundamental aspect of this is empowering all employees to communicate well. Effective communications help to make the vision and values a reality by supporting Council services, encouraging cultural and behavioural change and enabling new levels of engagement. Our Values were launched in June 2020 and work continues to embed these values in everything we do including working with HR & OD to weave these into the full employee lifecycle/journey. Initial training on this is already available on the council’s iLearn platform. An internal communications and engagement strategy was developed on the approach the Council will use to engage with staff. Various internal communication channels are used, this includes: • ‘Staff News - Take 5’ - weekly staff update; • staff monthly newsletter; • fortnightly - Chief Executive’s Blog; • regular Team Briefs for managers to inform and update staff on key issues; • use of text messaging and posters to reach frontline workers; • new ‘Staff information’ section on website • use of Microsoft Yammer for news and staff updates; • Pulse survey on internal comms during the pandemic; and • a working from home survey to gain understanding of staff viewpoints and supports required. Directed by the council’s marketing and communications strategy, we manage various council channels – including the council website, developed to ensure regular direct communication and the sharing of information with residents, with mechanisms for feedback and response (monitored for effectiveness), we use Page 118 of 128
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Page 41 of 43 external media and partners to reach audiences beyond our channel reach and maximise awareness, and we have developed a network of local channels (122) operated by local groups who support the cascade and sharing of council news and information. Council communications can be a mix of public campaigns, information on service updates, council decisions and policy changes, and spotlights on the people who deliver council services and those who benefit from them. The overall aim is to communicate our progress on the commitments made in the Council Plan. Participatory Budgeting The Council delivered a £1.2M #YouDecide programme in 2024 which was a participatory budgeting process to allow communities to identify what infrastructure improvements they wanted in their area. This equated to 5% of the Roads Capital Investment Programme over a three-year period. As well as giving local people a key role in the decision-making process around improving infrastructure within their local area, the Council gained a better understanding of community priorities. In total, 2811 ideas were generated from residents across Renfrewshire. These ideas were then shortlisted to 119 projects, with nearly 5000 votes received. To date, 38 projects have been completed with the remaining projects are on track to being delivered this year. As a result of the campaign 87% of local people agreed that they had increased knowledge of participatory budgeting, with 81% of local people agreeing that it was a good way for the Council to identify projects and allocate funding. For those who provided feedback in relation to participating in the process, 65% of people advised that they had never taken part in a Council consultation before, demonstrating the effectiveness of the engagement process in reaching those who had not previously engaged with the Council and who may have been harder to reach in the past. Celebrating Renfrewshire continues to develop and a five-year celebration event will take place in early 2025. 2.3.3 Financial governance framework The Council has in place financial regulations, which set out the responsibilities of the Director of Finance and Resources, along with the responsibilities of other authorised individuals in relation to the financial affairs of the Council. The 1.3.1 1.3.2 1.3.4 4.2.7 Page 119 of 128
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Page 42 of 43 regulations also set out the responsibility of Boards for financial affairs. (1.3.1; 1.3.2; 1.3.4; 6.2.5). Council receives regular updates on the financial position of the organisation. Financial reports detailing revenue expenditure and income are made to Policy Boards throughout the year and are based on the total cost of the main divisions of service and the total cost based on the key expenditure headings such as employee costs, etc. These reports provide projected outturns and are also used to advise members of any anticipated deviation from budget. Capital expenditure and income reports also follow this same process with each capital project showing previous years’ cumulative spend. Through the regular submission of budget reports to Policy Boards, the publication of the Annual Accounts, submission of the annual audit report and other audit reports to the Council and/or Audit, Risk and Scrutiny Board as appropriate and by publishing performance information on the Council’s website, the Council demonstrates transparency and compliance with statutory reporting requirements. The medium-term financial strategy is presented to Council each year along with regular financial outlook updates, and sets out the current financial position and the significant financial challenges to be faced in the forthcoming years, together with likely indications of grant and spending levels. Overall, the Council’s medium- term financial position takes into consideration all known influencing factors. 4.2.8 4.3.1 4.3.2 4.3.3 6.2.5 6.5.1 7.2.1 7.2.5 Transformation programme to support financial sustainability The Council’s transformation activity since 2010, alongside strategic finance activities, has delivered around £190m of savings. Most recently, the Right for Renfrewshire transformation programme, which has just concluded, delivered £26m of savings against a target of £25m. The next phase of transformation – Reshaping Renfrewshire – will be overseen by a refreshed Transformation Board. More detail on this work can be found in a paper approved by the Leadership Board in February 2025. 3.2.2 4.1.1 4.2.8 4.3.1 4.3.2 4.3.3 6.5.1 Data Advisory Group Following a data maturity assessment (completed in 2022), the Council has established a Data Advisory Group (DAG) to lead on corporate business intelligence work, share best practice , ensure overall alignment with Council and 6.4.1 6.4.2 6.4.3 Page 120 of 128
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Page 43 of 43 national policies, manage a Council-wide overview of data assets, manage a list of Master Data Sets, and work with services on appropriate culture change strategies and support the adoption of new roles and responsibilities to drive the required change. DAG membership is a mix of subject-matter experts and service representatives. Our Leaders Forum and Chief Officers Forum The ‘Our Leaders Forum’ is a quarterly meeting of all Chief Officers and third-tier managers across the Council. This forum has been in place for a number of years and provides an opportunity for senior leaders to discuss issues on a cross-service basis, as well as help shape corporate priorities. The Chief Officers meet as a group four times a year to work on strategic development areas. These groupings also support our ongoing commitment to leadership development. 5.1.3 Page 121 of 128
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___________________________________________________________________ To: Audit, Risk and Scrutiny Board On: 17 March 2025 ___________________________________________________________________ Report by: Director of Finance and Resources ___________________________________________________________________ Heading: Audit Scotland Local Government Financial Bulletin 2023/24 ___________________________________________________________________ 1. Summary 1.1 Each year, Audit Scotland prepare a Local Government in Scotland Financial Bulletin on behalf of the Accounts Commission. These provide a high-level analysis of the financial position of Scottish councils. The latest bulletin, covering the financial year 2023/24 was published in January 2025. This report provides an overview of that latest bulletin. 1.2 As in previous years, the bulletin sets out what it believes are the challenges facing local government finances and assesses the sustainability of funding. 1.3 The report has a strong focus on budget gaps, and the work that the Accounts Commission believe is required in relation to medium and longer-term transformation in order to address these gaps. The bulletin makes reference to a recent Audit Scotland publication on transformation, and a paper on that report was presented to the Audit, Risk and Scrutiny Board in January 2025. ___________________________________________________________________ 2. Recommendations 2.1 It is recommended that members of the Audit, Risk and Scrutiny Board: Item 6 Page 123 of 128
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• Note the contents of this report. _________________________________________________________ 3. Background 3.1 Audit Scotland bases these annual bulletins on the annual accounts submitted by each local authority. For this year’s bulletin, they have reviewed the accounts of 30 councils. 3.2 These annual bulletins are intended to provide a sense of broad trends within the local government finance sphere. 4. Key Findings of the Accounts Commission Report Council Funding and Budgets 4.1 The bulletin provides details of financial settlements in recent years, and notes that the 2023/24 settlement was lower in real terms than pre-pandemic, though it adds that 2024/25 reflected a real increase. Scottish Government funding to local government in 2023/24 was £13.7 billion, plus an additional £1.6 billion at the autumn revision specifically for teacher salaries and to support transfer of duties from other government portfolios. 4.2 The Accounts Commission calculated that ring-fenced and directed funding accounted for 21% of the total. They note this was a reduction and was due to the Verity House Agreement; a number of previously ring-fenced items were moved to the general revenue grant including monies for early learning and childcare, free personal and nursing care, social care living wage funding, and free school meals. 4.3 The Accounts Commission looked at the budget gaps of 29 local authorities and found a collective gap of at least £459 million for 2023/24. Exhibit 2 within the Accounts Commission report shows how each council intended to bridge that gap. 4.4 The bulletin notes the real terms reduction in capital funding, partly due to the completion of the capital element of early years expansion. As a consequence, councils are more reliant on borrowing or on transfers from revenue budgets to fund capital spend. Financial Performance Page 124 of 128
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4.5 Section 2 of the bulletin covers the financial performance of local authorities. It notes a real terms decrease in the level of funding once sources of income other than the grant are considered. The Accounts Commission states that increases in income have not kept pace with inflation and that total funding and income in 2023/24 had fallen back to 2019/20 levels. 4.6 The bulletin also notes that the proportion of income raised from Council Tax has been static for the last five years at around 13% of total income. Income from fees, charges and other customer elements fell during the pandemic and has not yet recovered to pre-pandemic levels. The Accounts Commission state that several councils identified the limited capacity to increase income generation as a risk to their financial sustainability. 4.7 Nine councils reported an overspend in their revenue budget in 2023/24, with workforce issues and income identified as contributing factors. Exhibit 4 in the Accounts Commission report sets out common areas of underspend and overspend. 4.8 The collective savings to be delivered in 2023/24 are given as £362 million, and the report notes that 11 councils achieved or exceeded their full savings target, 13 achieved at least 80% of their target amount, four achieved less than 80% of their target, and 2 had no savings target. The diagram below, taken from the bulletin, shows the proportion of savings achieved in each council area. 4.9 The Accounts Commission highlight that in their previous financial bulletin, they had recommended councils prioritise recurring savings, and in this year’s bulletin they state that it is difficult to determine the extent to which this has been achieved, due to what they say is “a lack of detail and transparency in reporting on savings performance”. They also found that not all councils include progress with savings in their commentary within annual accounts. It is the view of the Accounts Commission that council reporting should be more transparent about the nature of savings and the potential impact on services. 4.10 In relation to capital spend, it is noted that this was lower than planned in 25 council areas. The reasons included supply chain issues, contract and legal negotiations, and unexpected issues arising during the course of works. Page 125 of 128
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Proportion of savings achieved, 2023/24 4.11 The Accounts Commission highlight two general issues in relation to school estates; firstly the need for councils to borrow to fund new schools and secondly, a number of Private Finance Initiative (PFI) schools are nearing the end of their contracted terms. Financial Position and Outlook 4.12 The report notes that usable reserves in the whole sector decreased by 5% in 2023/24, although they are higher than before the pandemic. The use of financial flexibilities (e.g. reprofiling debt) has been given as a key reason for this. The Accounts Commission states that the use of reserves to support service spend is not sustainable. 4.13 Recent changes within the Strathclyde Pension Fund have resulted in a short- term boost to finances for the 12 council members (including Renfrewshire) of Page 126 of 128
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the scheme, with employer contributions temporarily reduced from 19.3% to 6.5% in 2024/25 and 2025/26, and to 17.5% in 2026/27. Other pension funds have made smaller reductions to the contribution. 4.14 As in previous reports on local government finance, the Accounts Commission highlight demographic changes as a challenge for local government. Renfrewshire’s population has increased significantly since the 2011 census, rising from 174,908 to 183,874. This represents a 5.1% increase on 2011, which is well above the national increase of 2.7%. In line with the national picture, Renfrewshire has an ageing population and the impact of this can be seen in other census trends – the increasing number of single-person households, decreasing populations in particular areas, and a growing proportion of the population which is retired. The population change is being driven by net inward migration (people moving to Renfrewshire from other parts of Scotland) rather than increased birth rates. The latest census also identified that a higher proportion of Renfrewshire residents describe their health as ‘bad or very bad’ compared with the national average. Consideration of the latest population data will continue to inform strategic and operational planning across the Council. 4.15 The Accounts Commission consider changing demographics to be one of the drivers of increased demand for local services, which has a consequent impact on the level of spend required. They also highlight new policy areas requiring significant investment, uncertainty on future funding and inflationary pressures as continuing challenges for councils. They continue to state the importance of larger scale and faster delivery of transformation plans to support financial sustainability. ___________________________________________________________________ Implications of the Report 1. Financial – none, though the report references national trends in relation to local government finance and provides local context. 2. HR & Organisational Development - none 3. Community/Council Planning – none 4. Legal - none 5. Property/Assets – none Page 127 of 128
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6. Information Technology – none 7. Equality & Human Rights - the recommendations within this report have not been assessed in relation to their impact on equalities and human rights as the report concerns a national bulletin on local government finance and is for noting only. 8. Health & Safety – none 9. Procurement – none 10. Risk – none 11. Privacy Impact – none 12. Climate Risk –not applicable 13. Children’s Rights –not applicable. 14. COSLA Policy Position –not applicable. _______________________________________________________ List of Background Papers ___________________________________________________________________ Author: Lisa Fingland, Policy Manager, lisa.fingland@renfrewshire.gov.uk Page 128 of 128