Minutes of the Audit and Risk Committee – May 2023

Present

Members

• Vanessa Davies (Chair) Non-Executive Director
• David Watt Non-Executive Director

In attendance

• Keith Dargie - COPFS Chief Digital Officer and Head of Business Services
• Marlene Anderson - COPFS Director of Finance and Procurement
• Jim Montgomery - Audit Manager, SG Internal Audit Directorate
• William Wilkie - Senior Auditor, SG Internal Audit Directorate
• Richard Frew - Head of Business Strategy, Policy and Governance KLTR
• Catriona Deans - Solicitor KLTR
• Zahra Mahmood - Senior Audit Manager, Audit Scotland
• Ishbel Christie -COPFS Head of Financial Accounting and Systems
• Lindsey Miller - Deputy Crown Agent, COPFS
• Steve Scott - Programme Manager Pathology, Mortuaries and Toxicology

Secretariat

• Ian Palmer - COPFS Finance and Procurement Division

Apologies

• Annie Gunner Logan - Non-Executive Director
• John Logue - Crown Agent (interim)
• Robert Sandeman - KLTR Accountable Officer
• Brian Howarth - Audit Director, Audit Scotland
• Maggie Bruce - Senior Audit Manager, Audit Scotland

VD (Chair) welcomed everyone.

There were no declarations of interest.

There had been no pre-meetings as such. The Chair reported having met Laura Paton, Chief Inspector, on 28 April 2023 to discuss the Committee’s Terms of Reference. The Chair had also received comments on the papers from Annie Gunnar Logan and raised these as relevant.

The minutes of the meetings of ARC held on 5 February 2023 were approved.

Secretariat will arrange for the approved minutes to be published on COPFS website.

ARC Paper 15 (2023) (ARC Action Tracker) was noted.

It was agreed that action points 28 (2022) and 1, 3, 7, 8,9,10,11 (2023) had been completed and could be removed from the tracker.

The following updates were noted:

Item 2/23 (Progress in relation to implementation of Case Management in Court
(CMiC) for Summary Cases).

KD gave a general update. It was agreed that this item will remain on the tracker until fully concluded.

Action:

KD to send Secretariat a summarised note of progress with CMiC implementation for distribution to the meeting group.

Item 4/23 (KLTR Governance Review – basis of accounting) -

This will be included in the Governance review.
Item 5/23 (Summarised table of litigation matters) - Crown Agent’s legal assistant is
working on this for presentation at the ARC meeting 9 August 2023.

Action

Secretariat to place Summarised Table of Litigation on agenda of August 2023 ARC meeting.

Item 6/23 (Inspectorate of Prosecutions Scotland action tracker) – This is being developed and will be presented at the ARC meeting in August 2023. VD (Chair) reported that she had met recently with the inspectorate, and they welcomed the ongoing work being done by COPFS to monitor action progress.

Action

Secretariat to put Inspectorate of Prosecutions Scotland action tracker on agenda of August 2023 ARC meeting.

Internal Audit Tracker

ARC Paper 16A (2023) was noted.

Work is ongoing within COPFS to ensure that all items on the tracker remain current and that the RAG status is reviewed regularly.

External Audit Tracker

ARC Paper 16B (2023) was noted.

RF gave an overview of ARC Paper 17 (2023) KLTR update and ARC Paper 17 A (2023) KLTR Risk Register

The committee noted the papers and looked forward to sight of the Governance review and its proposals before decisions about changes were made; and to a briefing on the final stages of the OPTS before its go-live. VD also asked whether the Risk register ought to include information about risks and controls in relation to fraud

Action

KLTR to arrange to update ARC on the Governance Review and OPTS before the next decision-making points; and to consider including a specific risk of fraud on the risk register.

There was no formal presentation of an update as all relevant issues had been covered in other parts of the meeting agenda.

The tracker is being developed and will be presented to the ARC Meeting in August 2023.

LM and SS joined the meeting to give an overview of ARC Paper 18 (2023).

The committee welcomed the concise but informative style of the paper.

General discussion followed. It was agreed that the Corporate Risk Register is to be reviewed in order to incorporate issues raised in the report.

It was agreed that a further update would be given at the ARC meeting in August 2023.

Actions

MA to review Corporate Risk Register to reflect any issues raised in the Mortuary and Pathology Procurement report.

Secretariat to add Mortuary and Pathology Services Procurement update to agenda of ARC Meeting on 9 August 2023.

MA gave an overview of ARC Paper 19 2023

Highlights included:

Latest forecast for 2022/23 reflects a current residual underspend of £1m compared to £864k previously reported to the Committee. This improved position is due to Major Case non staffing costs being reallocated as a result of the costs of counsel and legal advice being lower than anticipated.

Movement between capital and revenue has been agreed with Scottish Government.

Inflation and increased demand through Court Recovery Programme continues to impact. Finance Business Partners and HoBMs are maintaining close liaison to ensure that all potential savings and counter inflationary measures are identified. This is augmented by ongoing COPFS Business Process Reviews to maximise efficiencies.

Overtime continues to be closely monitored. Additional overtime was approved for the end of FY 2022/3 to optimise preparedness for entering FY 2023/4.

COPFS Accounting Policies

IC presented ARC Paper 19 A (2023)

After general discussion including in relation to the impact of IFRS 16, ARC approved the COPFS Accounting Policies.

Action

MA/IC to confirm, actuarial age position in relation to Injury Benefits policy

COPFS Annual Fraud Report

MA presented ARC Paper 19B (2023)

After general discussion the committee noted the paper.

Deep Dive Review: Operation and Management of COPFS Financial Controls

MA presented ARC Paper 19C (2023) and gave a general overview.

The committee welcomed the comprehensive scope of the report and after general discussion noted the paper.

ZM gave a verbal update on the progress of the current annual audit.

It was agreed that Audit Scotland will send ARC written confirmation of the conclusions of the interim audit.

ARC Paper 20 (2023) DIAA Annual Assurance Opinion Report COPFS 2022-23 was presented, and a general overview given.

The overall audit opinion was “Reasonable Assurance”

General discussion followed.

The following papers were also noted by the Committee:

ARC Paper 20 A (2023) COPFS Response to Pandemic

ARC Paper 20 B (2023) Internal Audit Charter

ARC Paper 20 C (2023) Internal Audit Strategy

ARC Paper 20 D (2023) DIAA Quarterly Bulletin

DW and VD noted in particular the challenges set out by the incoming IA Director General and concluded that some form of appraisal of current arrangements and practices (including of the assurance mapping work described at item 12), and especially given a new COPFS strategy, would be helpful and should be done in consultation with the CA.

Action

Chair to discuss with NXDs and CA the possibility of an additional reflective meeting to ensure suitability of audit and risk arrangements going forward.

MA presented ARC Paper 21(2023) and gave a general overview

Assurance Mapping Group 1

1.1 Strategic Planning

1.2 Business Planning

1.3 Major Investment

1.4 Project Management

The Committee noted the paper and general discussion followed.

In relation to COPFS Programme and Project Management, it was agreed that further work is required to develop and enhance the overall strategy.

Action

KD and WW to arrange to meet at some point in August 2023 to discuss COPFS Programme and Project Management Strategy

MA presented ARC Paper 21A (2023) Assurance Mapping Review 2022 -23 and gave a general overview.

The Committee noted the paper.

During general discussion the Committee suggested that it would be timely for COPFS to review the Assurance Mapping reports to ensure that the RAG status, particularly where an overall green assessment had been given, was an accurate reflection of the current position.

MA reported that work in this area was ongoing and that these issues were being explored at a number of Senior Management events.

Updates on progress are being fed back to Executive Board.

DW presented ARC Paper 22A (2023): COPFS RMG Annual Report 2022 -23 and gave a general overview.

The Committee welcomed the paper and general discussion followed.

Membership of the RMG and the structure of group meetings was explored.

Action: WW to issue ARC with an up-to-date copy of SG Risk Management Guidance.

DW also presented the following

ARC Paper 22 B (2023) Minutes of RMG Meeting April 2023

ARC Paper 22C (2023) Corporate Risk Register

These were duly noted.

VD presented ARC Paper 23 (2023)

Subject to minor further typographical additions the revised Terms of Reference were approved by the Committee. The Committee noted that there may be further changes to the ToR in due course to reflect any changes in governance arrangements for the KLTR which may follow their current review.

Secretariat will liaise with group to find a suitable date for Signing of COPFS Annual Accounts.

9 August 2023 at 11am

MS Teams or Room 1 Conference Room, Crown Office