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CM/02/17/09
PUBLIC BOARD MEETING
22 February 2017
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Audit and Corporate Governance Committee
(ACGC) Report to the Board
Paul Rew, Chair, Audit and Corporate Governance
Committee
Martin Harrison, Committee Secretary
PURPOSE OF PAPER:
To provide the Board with a report of the meeting of the Audit and Corporate Governance
Committee (ACGC) on 25 January 2017.
Introduction
1.
This is an information report from the meeting of the Audit and Corporate
Governance Committee (ACGC) which was held on 25 January 2017. A number of
reports and briefings were discussed. The most significant are summarised below.
Recommendation
2.
The Board is asked to NOTE the Audit and Corporate Governance Committee report.
Summary
3.
Risk and Management assurance
The Committee considered the latest (2016/17) risk management information in the
Strategic and High level Operational risk register; proposed Strategic and High level
operational risks for 2017-18; and levels of tolerance in CQC’s risk tolerance
statement.
4.
2016/17 Risk register – In reviewing the current risk management information, the
Committee was assured that there were no risks for which any new and significant
concerns arose. The Committee affirmed the importance of digital technology as
central to the success of the Strategy and therefore we are intending to spend time at
our next meeting looking in more detail at risks related to implementation of the
digital strategy.
5.
Proposed Strategic and High level operational risks for 2017-18 - The Committee
was able to provide advice and comment on proposed Strategic and High level
operational risks for 2017-18. In light of this, the proposed risks for 2017-18 will be
presented to the Board for consideration.
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7.
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Risk tolerance statement - The Committee reviewed the current risk tolerance
statement. We provided some minor comment on drafting but overall, the Committee
was content that there did not need to be a change in the levels of tolerance set out
in the statement.
Internal Audit
The Committee noted progress against the 2016 / 17 internal audit programme, the
findings from reports and management actions within final reports. Since the last
meeting of the Committee, eight audit reports have been issued with one report homeworker arrangements – receiving a ‘limited’ assurance rating The Committee
was content that appropriate action was in place to address the findings of the
homeworker arrangements audit and we have asked for a progress update at our
next meeting.
8.
In addition, the Committee was able to agree some changes to the 2016/17 internal
audit programme. These involved: additional work to undertake a review of the
Implementation Plan for CQC’s new Strategy; further work around the assurance in
place over IT disaster recovery arrangements; and deferral of planned audits on
Customer Services Modernisation and Inspection Reports. Both of these deferrals
will be considered as part of audit planning for 2017/18.
9.
The Committee is due to receive the draft internal audit risk assessment and plan for
2017/18 at its next meeting in April. In previous years the involvement of committee
members in development of the draft plan via consultation outside of formal meetings
had been helpful and committee members are content to be involved again in a
similar way
Audit report on the 2016/17 financial statement audit
10. The Committee considered the proposed audit planning report on the 2016/17
financial statement audit. We were content with the completeness and coverage of
the assessment of potential risks of material misstatement to the financial statements
and the Committee was therefore able to agree the proposed audit plan to address
identified risks.
National Audit Office value for money study
11. The Committee received an oral update on progress. It is planned that NAO
colleagues will be able to join our next meeting to discuss the study in more detail.
Pensions governance
12. Following discussion on pension obligations at recent meetings, the Committee
received a report setting out further detail about the arrangements relating to pension
schemes of which CQC was an active member. While there is no significant or
specific concern at present, there are still some areas where further clarity is needed
around the exact responsibilities of CQC and how this relates to the responsibilities
of Department of Health (DH). The Committee noted that this will be raised with
colleagues from DH.
Annual report and accounts: proposed structure and timetable
13. The Committee noted proposals for the structure and key messages for the 2016 / 17
Annual Report and Accounts. The Committee also noted the timetable for
preparation and sign-off of the Report and Accounts, noting that there will be further
opportunities to comment as the draft develops and is presented to future meetings.
As with previous years, there will be an opportunity for Board and ACGC members to
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meet individually with Finance and Editorial staff to scrutinise the report and accounts
in much greater detail.
Disclosure and Barring Service (DBS) incident follow-up
14. At its meeting on 22 September, the Board considered the full report of the external
review into last Julys data security breach and the CQC response to that
independent review. The Board asked ACGC to oversee implementation of the
recommendations. Accordingly, the Committee received a report setting out action
carried out to complete the recommendations of the external review and an overview
of the wider programme of work on security improvements. The Committee was
assured that five out of the six recommendations had now been completed and work
to complete the final one - a programme of security culture change so that CQC
could become an exemplary information security organisation – was in train. We note
that the external reviewer is scheduled to return to CQC during the summer of 2017
to test that recommendations have been successfully implemented and will also be
asked to review the CQC Values Information programme. The Committee also
suggested that it would be helpful for internal audit to review progress in 2017/18.
Name:
Title:
Date:
Paul Rew
Chair, Audit and Corporate Governance Committee
1 February 2017
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