Contact: Jeff Pattison, ext 6356, email [email protected] or Ejner Knudsen, ext 7403, email [email protected]

1 Summary

1.1 This report incorporates a draft Annual Governance Statement which is required to be submitted and approved by the Governance Committee by virtue of the Accounts and Audit Regulations 2003 before the end of June 2008, prior to being signed off by the Leader of the Council and the Chief Executive.

2 Recommendation

2.1 The Committee approves the draft annual Governance Statement for signature by the Leader of the County Council and the Chief Executive subject to any amendments that the Committee may wish to make.

3 Background

3.1 The County Council is required under the Accounts and Audit Regulations 2003 as amended in 2006 to produce a broad-based Annual Governance Statement. This represents a change from the previous requirements which was to submit a Statement of Internal Control. This has required changes to the content of the Statement. As previously, however, the Statement needs to be approved by the Governance Committee on behalf of the County Council before the end of June 2008. It then needs to be formally "signed off" by the Leader of the County Council and the Chief Executive.

3.2 The Statement continues to form an important and integral part of the Corporate Governance Regime and also the Comprehensive Performance Assessment Framework. The importance of the Statement stems from the fact that it provides a review of the effectiveness of the County Council's internal control systems and is also intended to give assurance about how effectively they operate in practice.

3.3 As noted above, the revised requirement to produce an Annual Governance Statement in place of the Statement of Internal Control has necessitated a revision and extension to the contents of the statement. In doing this, particular note has been given to guidance supplied by the Finance Advisory Network of the Chartered Institute of Public Finance and Accountancy (CIPFA) albeit that this guidance has been finalised only very recently.

3.4 As members will appreciate, the previous statement of internal control has been built upon detailed questionnaires which have been sent to all Chief Officers and to those other officers who undertake an essential Corporate role within the organisation every two years. Therefore, revised questionnaires should have been sent out in August of 2007. However, it was known at that time that changes from a Statement of Internal Control to an Annual Governance Statement would be required with detailed guidance on the content to follow. In these circumstances, it was not considered appropriate to send out questionnaires on out-of-date requirements. It was agreed instead to reconsider overall Corporate Governance requirements and the approach to the Annual Governance Statement and to submit revised questionnaires based on these changes. These revised questionnaires have now been sent to all Chief Officers and to those fulfilling a significant corporate role on behalf of the County Council.

3.5 In the meantime and in order to ensure appropriate assurance, all Chief Officers have been asked for and supplied confirmation that the information supplied previously can be replied upon. In addition, all officers undertaking a substantial Corporate role have been required to supply an appropriate position statement based upon the CIPFA Financial Advisory Network Guidance.

3.6 A copy of the emerging Annual Governance Statement has been sent to all Chief Officers and to those undertaking a Corporate role for any further comments that they wish to make. In addition, the emerging draft Annual Governance Statement has been sent to all members of the Governance Committee for any observations or comments that they wish to make. These comments have been taken into account in drafting the version of the Annual Governance Statement currently before the Committee.

4 Draft Annual Governance Statement

4.1 A Draft Annual Governance Statement is attached as an Appendix to this Report. This, as mentioned above, broadly follows the Chartered Institute of Public Finance and Accountancy Financial Finance Advisory Network Guidance in terms of content. Members now have the opportunity to comment upon it and indicate whether or not they wish to see any amendments made.

Section 100D - Local Government Act 1972 - Background Papers

The following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

NB the list includes:

Chartered Institute of Public Finance and Accountancy Finance Advisory Network Rough Guide to the Annual Governance Statement

Letters of Assurance from Chief Officers.

Statements from Officers on those issues referred to in the CIPFA Finance Advisory Network Guidance Document.