Corporate report

Audit and Risk Assurance Committee minutes: 13 March 2019

Updated 23 October 2023

Applies to England

Present

John Hughes, Chair of Audit and Risk Assurance Committee

Kathryn August, Board member

James Aston, Co-opted member

Helen Jesson, Co-opted member

Venessa Willms, Board member

Also in attendance

Amanda Spielman, Her Majesty’s Chief Inspector (HMCI), Accounting Officer

Matthew Coffey, Chief Operating Officer

Louise Grainger, Director, Finance, Planning and Commercial

Simon Helps, National Audit Office

Jane Forbes, Internal Audit – Pricewaterhousecoopers (PwC)

Carol Hartley Burdett, Internal Audit – Government Internal Audit Agency (GIAA)

Ivan Cheary, Internal Audit – Government Internal Audit Agency (GIAA)

Matthew Terry, Corporate Governance Manager

Apologies

None.

Status

Approved

1. Chairman’s introduction, declarations of interest, minutes, actions and matters arising

The Chair welcomed members and attendees, including Carol Hartley Burdett and Ivan Cheary of GIAA. GIAA will provide Ofsted’s internal audit function from 1 April 2019.

The minutes of the previous meeting were approved subject to one minor correction.

2. Report from Chair and Members

The Chair informed the Committee that he had shadowed an inspection of an apprenticeship and skills provider since the Committee last met, and noted the successful launch of the EIF consultation.

3. Audit update

Progress against audit recommendations and Public Accounts Committee (PAC) actions

The ARAC received a report detailing progress against both audit recommendations, and actions arising from the PAC’s report following on from the NAO’s value for money report.

The due dates for the completion of the Early Years Framework review and the updating of the Information Security policy had not been met. Louise Grainger confirmed that the Early Years Framework review would now be completed by 22 March; the Information Security policy had been agreed by the Executive Board on 26 February and circulated to staff; and that the Contact Centre actions would be updated to reflect the new agreed management actions.

4. Internal audit progress report

Jane Forbes updated the Committee on progress made against the 2018-19 internal audit plan, noting that since the Committee last met the internal audit reports relating to Management Information, Attendance Management and Continuous Auditing had been issued.

Members were content with the progress made against the 2018-19 internal audit plan and noted that the fieldwork for digital transformation programme audit had been completed. The audit will be considered by the Committee on 11 June.

The Committee discussed the advisory support provided by PwC towards the review of the corporate governance framework. HMCI outlined that work to update the corporate governance framework was ongoing and therefore the audit planned for March 2019 would not proceed.

5. Internal audit reports

Jane Forbes presented the reports that had been issued since the Committee last met:

• Management Information – The audit reviewed the existing processes in place around management information to assess whether management can place reliance on the existing information framework and make informed decisions based on the information they receive. The Committee discussed the audit and noted that the audit was reassuring and was classified as low risk.

• Attendance management – The audit sought to understand how well the new attendance management policy has been received and understood; the quality of interactions between managers and their staff; and whether suitable training and communications over the expectations of managers resulting from the policy has been effectively provided. The Committee discussed the audit and noted it was classified as low risk.

• Continuous auditing (period 2) – The audit forms part of the rolling programme of audit work responsible for compliance testing Ofsted’s core financial controls. No exceptions were identified.

6. Internal audit plan 2019-20

The GIAA presented a draft internal audit plan for 2019-20. The plan had considered risks to strategic priorities and been informed by discussions with stakeholders, including HMCI and the Chair of the Audit and Risk Assurance Committee.

The Committee discussed the audits planned for 2019-20 and provided feedback on the draft plan and draft internal audit charter to HMCI and GIAA. There was agreement to amend the charter to specify that all work carried out by GIAA should be with the agreement of Ofsted’s Executive Board. The plan and charter will be finalised and then approved by HMCI.

7. National Audit Office (NAO) external audit report

The NAO informed the Committee of upcoming value for money reports that may be of interest to Ofsted. Ofsted have worked with the NAO on their report on support for children with special educational needs and disabilities.

A report on the sustainability of funding in Further Education and Skills will also be undertaken by the NAO in 2019-20. Ofsted will be consulted throughout.

8. Interim financial audit update

The Committee noted that the interim financial audit was now underway. The NAO confirmed that they had not identified any issues that warrant the attention of the Committee.

9. Audit and Risk Committee effectiveness review

Simon Helps introduced the findings of the review into the Committee’s effectiveness. Members discussed the findings at length, agreeing to make a number of changes in order to further reflect best practice, and to additionally strengthen the Committee’s expertise.

Action: A summary and action plan detailing the outcomes of the Committee’s discussion of the effectiveness review to be produced and agreed with the Chair.

The Chair thanked the NAO for their work in co-ordinating the effectiveness review. It was agreed that progress against the actions noted from the review, and a discussion around the timing of the next effectiveness review, will be considered at a future meeting.

10. Risk update

Louise Grainger presented the latest strategic risk register to the Committee for comment.

The Committee noted that the workforce risk had reduced from high to medium probability. Members robustly challenged the residual risk ratings and recommended further refinements to the format of the risk register including deletion of any routine controls and discussed options to maximise the usefulness of the commentary for readers.

The Chair offered the Audit and Risk Committee as a task and finish group for the strategic risk around unforeseen events.

11. Finance Report

The Committee noted both the year to date financial position and forecast against the full year budget.

12. 2019-20 budget

Louise Grainger outlined that executive led strategic priority reviews had supported the budget setting process and linked the budget planning more closely to the strategy.

The Committee requested that future budget reports should include the prior year comparator.

The Committee discussed the risks and opportunities related to the budget including the potential liability relating to the cross government increase in employer pension contributions.

13. Any other Business

None

End of meeting

The next Audit and Risk Assurance Committee meeting will take place at 10.30am on Wednesday 11 June 2019, in Clive House room 403a