GLOUCESTERSHIRE HOSPITALS NHS FOUNDATION TRUST

Transcription

1 GLOUCESTERSHIRE HOSPITALS NHS FOUNDATION TRUST MINUTES OF THE AUDIT COMMITTEE HELD IN THE BOARDROOM, 1 COLLEGE LAWN, CHELTENHAM ON TUESDAY 1 FEBRUARY 2011 THESE MINUTES MAY BE MADE AVAILABLE TO THE PUBLIC AND PERSONS OUTSIDE OF THE TRUST AS PART OF THE TRUST S COMPLIANCE WITH THE FREEDOM OF INFORMATION ACT 2000 PRESENT (Members) Mr Mike Evans ME Chairman and Non-Executive Director Mr Clive Lewis CL Non-Executive Director Mrs Helen Munro HM Non-Executive Director IN ATTENDANCE (By invitation) Mrs Sarah Truelove ST Director of Finance Mr John Golding JG Grant Thornton, External Audit Ms Claire Thomas CT Grant Thornton, External Audit Mr Peter Stephenson PS Price Waterhouse Coopers, Internal Audit Mr Geoff Fox GF Governor, Cheltenham Constituency Mr Andrew Collis AC Trust Secretary Mr Andrew Cheesman ACh Head of Finance Shared Services Mr Doug Weldon DW Lead Governor Mrs Hilary Millington Personal Assistant to Director of Finance APOLOGIES Mr Simon Cookson SC Price Waterhouse Coopers, Internal Audit Mrs Sallie Cheung SCh Local Counter Fraud Specialist Dr Colin Roch-Berry CR-B Governor, Tewkesbury Constituency Mr Andrew Seaton AS Director of Safety Mike Evans welcomed Helen Munro, Non-Executive Director, as a new member of the Audit Committee; Andrew Cheesman, Head of Finance Shared Services, attending re Internal Audit reports on Finance Shared Services; Doug Weldon, Trust Governor, attending as an observer. ACTION 001/11 MINUTES OF THE MEETING HELD ON 7 DECEMBER 2010 The minutes were agreed and signed with one amendment:- 056/10 2 nd paragraph CT had worked for several other organisations including PWC, Wales Audit Office LHB, and with local authorities and central government. GF commented on the Consultant Job Plan report from the Internal Auditors. He was not happy with the system. ME reported that this report had been accepted by management and that he would ask Dr Elyan to discuss it with GF. GF also asked about the list of Acronyms which he had requested. was still working on it. CL had attended an Induction which included Acronyms which he had found useful, he suggested that check out the Appointments Commission website. ME Risk Register ME reported that he felt that the Audit Committee should be looking at the Key Risks update sent to the Main Board. ST had the paper which identified 3 main risks was there sufficient bed capacity; regulatory action re Trust s water system; procedures re violence and aggression. For the benefit of new Audit Committee members, ME explained the scoring system the likelihood of the risk Audit Committee Minutes Page 1 of 6

2 happening was measured 1 to 5 (low to high), the resulting impact was measured in the same way. These 2 figures were multiplied together for the final score (highest being 25). The Trust Risk Register focussed on those risks with a score of 15 and above. Each Division reviewed the risks monthly and reported the high risk areas to the Board. Each risk is considered to see if the risk can be got rid of, mitigated or lived with. It was agreed that AS bring the paper regularly to the Audit Committee for information. AS 002/11 MATTERS ARISING There were none. 003/11 INTERNAL AUDIT PROGRESS REPORT ME asked PS to explain to new members about how the Internal Audit Plan is created. PS explained that this was his 3 rd year working for the Trust. The Internal Audit Plan was very flexible, subject to change; and approved by the Audit Committee. A progress report was presented to the Audit Committee regularly. The report focussed on financial and operational risks helping the organisation to achieve its key objectives. PS presented the Progress Report. There was one change to the plan involving a new review of the process for Healthcare at Home, which was to be started soon. This review was to be funded by a reduction in the days allocated to project management. PS explained a few items in the Project Plan Progress. Item 7, Cultural Review, concerned interviewing 35 Heads of Department covering ethical guidance and code of conduct to ensure that rules and procedures were understood. All the work would be completed by the end of March PS explained the Key Performance Indicators on page 10 provided a measure of PWC s performance. PS explained the definition of the ratings criteria for each internal audit report:- There were 4 categories in the overall score High, Moderate, Limited and No Assurance. Each recommendation had 4 score rankings Critical, High, Medium and Low. PS informed the Committee that a satisfaction survey was brought at the end of each year for the Committee s completion. 004/11 INTERNAL AUDIT REVIEW OF FINANCE SYSTEMS PS reported a Moderate Assurance rating. Five recommendations were made. ACh commented that the Trust was moving to an electronic process for authorised signatory listings; these would be available on a Sharepoint site to be checked every time making it a much safer system. The Assistant Director of Finance was responsible for issuing an up to date authorisation list to Shared Services (this information was missing from the Action Plan for Payroll Page 8 to be updated). ACh also commented that the segregation of duties in the raising and authorisation of credit notes was now under control. Audit Committee Minutes Page 2 of 6

3 ACh explained the mechanics of the Shared Services systems to GF. ME raised his concern over the recommendations in this report not implemented, from previous reports. Audit recommendations should be followed up and implemented. INTERNAL AUDIT REVIEW OF CHARITABLE FUNDS PS reported a High Assurance rating. A very positive report with 2 minor recommendations. INTERNAL AUDIT PROCUREMENT AND CREDITORS PS reported a Moderate Assurance rating. There were 3 recommendations from previous reports which had not been fully implemented. PS commented that creditor invoices should be reviewed if they remain unpaid after a month. ACh reported that a new procedure was now in place which ensured that everything was done within 20 working days; it was a diarised system which was working well. ME expressed concern regarding the late completion of control reconciliations PS reported that New procedures have now been implemented to ensure timely reconciliations. INTERNAL AUDIT FIXED ASSETS PS reported a Moderate Assurance rating. There were no significant issues. PS commented that reconciliations are identified to the clients rather than Finance Shared Services (FSS); procedures could be tidied up around the management of assets and appropriate authorisation was important. ACh was addressing this issue. INTERNAL AUDIT REVIEW OF FINANCIAL LEDGER PS reported a Moderate Assurance rating. The report identified a timescale issue re control and suspense account reconciliations which ACh was addressing. INTERNAL AUDIT PAYROLL AND EXPENSES PS reported a Moderate Assurance rating. PS reported that there were no significant issues, just fairly minor points. There were areas of good practice. ME commented that it was a high volume pay processing system where effective controls are as important as processing. HM asked if there was a plan to go electronic with some systems, ME thanked PS and PWC for their work. JG commented that the Committee should feel comfortable with these reports. PS then left the meeting. ACh stayed for the rest of the meeting. Audit Committee Minutes Page 3 of 6

4 005/11 EXTERNAL AUDIT JG was pleased to report that Julie Masci (JM) had given birth to a baby girl, Jennifer. The Committee sent their best wishes. CT was supporting John while JM was on maternity leave who would be returning to work later in the year. JG explained that the role of External Audit was to provide assurance on the Trust s Accounts to show that the accounts reflected the work of the Trust; that the Trust used the resources effectively; that the Trust s Quality Accounts accurately measured the delivery of its services. JG would present the reports in a different order to the agenda. EXTERNAL AUDIT UPDATE ON AUDIT RISKS FOR 2010/11 Draft JG presented the report. Quality Accounts JG reported that GT is not sure of the scope of work that will be required for Quality Accounts, Monitor will confirm. Valuations of Assets the Trust has now implemented the principles of International Financial Reporting Standards (IFRS) and we need to keep this under review. Income recognition ST is agreeing the methodology with GT. Plant, Property & Equipment (PPE) equipment valuation (Fixed Assets). EXTERNAL AUDIT AUDIT PLAN FOR 2011/12 JG presented the report. He informed the Audit Committee that the report focussed on risk from an External Audit point of view; these areas were RPR (Reasonable Possible Risks). Quality Accounts to be produced for the financial year 2011/12 following a dry run 2009/10. The scope of this work will be confirmed by Monitor and JG will update the Committee in due course. GT s fee for the dry run was 17,860, JG expects this fee to drop to 12k for the year 2011/12.. ME commented on the use of resources audit, particularly Budget setting (bringing additional budget pressures to the Trust in 2011/12) and Service Line Management (SLR will give a better understanding of the operational financial performance, matching income to cost). ST reported that the Trust had begun 3 pilots schemes using SLR Ear Nose & Throat (ENT), Neurology and Gynaecology. The Trust was using an SLR tool on these 3 pilots before rolling it out across the Trust. EXTERNAL AUDIT UPDATE JG gave a verbal update to the Committee. He and the team would be on site on site next week to start interim work on the 2010/11 accounts. 006/11 AUDIT COMMITTEE ANNUAL REPORT ME produced the Audit Committee Annual Report as part of the Trust s Annual Report. Items to be included in the report were:- Audit Committee Minutes Page 4 of 6

5 Finance Shared Services Consultant Job Plan New appointment of External Auditors Audit Committee Workplan Internal Audit Report on UTOPIA Budgetary Control Service Line Management Counter Fraud External Audit Performance Helen Munro suggested including Income Recognition. ME and ST agreed to meet to discuss. ME/ST AC left the meeting at this point 007/11 REPORTS FROM THE DIRECTOR OF FINANCE MATTERS RE END OF YEAR ACCOUNTS ST presented the report. GF raised a query on the Trust s value of PFI (Private Finance Initiative) contracts. ST explained that the value included the cost of the build plus its maintenance costs. JG commented that the costs were directly visible in the Trust s Annual Accounts. PROPERTY DAMAGE INSURANCE ST presented the report explaining that the Trust was a member of the NHS Litigation Scheme. The Trust did not have separate property insurance. There were risks and benefits to this one of the benefits being that the costs did not take funding away from patient services. Costs would be 400k for 240m cover. ST confirmed to CL that a lot of Trusts took this decision. There were other funds where claims could be met, e.g. the floods claim of 2007 was met from a European Fund. GF commented that in the event of a disaster there could be adverse publicity for the Trust having no insurance. ST would take this subject to the Main Board for discussion. GF had read that monies paid out in damages had doubled in the past year Clinical Negligence claims had risen. ST commented that the Trust had recently achieved CNST Level 2 which would mean premiums would reduce however the overall costs of the scheme are increasing nationally. ST requested more information from GF in order to investigate this claim. DW reported that this discussion was already in the process of being investigated elsewhere in the Trust ST GF UPDATE ON SETTLEMENT OF OUTSTANDING DEBT ST presented the report, explaining that all disputes with 2Gether Trust had been resolved and that some bad debt had been written off. The Trust still had problems with patients registered with a Welsh GP being referred to Gloucestershire Hospitals for treatment without prior approval from the Welsh Healthcare Boards. ST reported that she signed several letters a week to turn away patients in this position, many of them being English students studying at Universities in Wales. HM suggested that perhaps a separate block contract could be set up to cover these funding issues. ME commented that some of these Audit Committee Minutes Page 5 of 6

6 patients had been treated in good faith in the past, but it was important that this should not be allowed to happen again, but that prior approval be sought to ensure the Trust was paid for this work. SINGLE TENDER ACTION ST presented the report. There was nothing in particular that ST wanted to raise and no questions from the Committee. NON ACCEPTANCE OF LOWEST TENDER QUOTATION ST presented the report. There was nothing in particular that ST wanted to raise and no questions from the Committee. LOSSES AND COMPENSATIONS ST presented the report. GF queried the amount lost in unpaid prescription charges. ST informed GF that the bulk of this was from A&E patients who claimed that they were exempt from prescription charges. 008/11 AUDIT COMMITTEE WORKPLAN 2011 ST presented the updated Workplan. JG asked for one item to be moved Follow up of External Audit Recommendation from February to April meeting. The Committee agreed to invite the Chief Executive to attend the May meeting, for the Assurance Framework Review and Statement of Internal Control in particular. 009/11 ITEMS FOR THE RISK REGISTER The Committee decided that the Building Insurance should be entered on to the Risk Register. AS ANY OTHER BUSINESS There was none. DATE OF THE NEXT MEETING The next meeting will be held on Tuesday 5 April at 9.15 in the Boardroom, 1 College Lawn. HM gave her apologies. ME asked CL to check that he was available. Post meeting note CL was available. Dates for further Audit Committee meetings in 2011:- Friday 27 May at 2.00 pm ; Tuesday 4 October at 9.15; Tuesday 6 December at OPPORTUNITY FOR DISCUSSION BETWEEN AUDIT COMMITTEE MEMBERS AND EXTERNAL / INTERNAL AUDITORS The Executive Directors left the meeting at this point. Audit Committee Minutes Page 6 of 6