Councillors will be asked to make any declarations of interest in respect of items on the agenda.

No declarations of interest were made.

To confirm the minutes of the meeting held on 20 January 2026 and the meeting of the Audit and Governance Sub-Committee – Armada Way Independent Learning Review Action Plan on 14 January 2026.

The minutes of the Audit and Governance Committee held on 20 January 2026 were agreed as an accurate record.

The minutes of the Audit and Governance Sub-Committee: Armada Way Independent Learning Review Action Plan held on 14 January 2026 were agreed as an accurate record.

To receive reports on business which, in the opinion of the Chair, should be brought forward for urgent consideration.

There were no items of Chair’s urgent business.

External Audit Progress Report and Sector Updates

Grace Hawkins (Public Sector Audit Director, Grant Thornton) introduced the item and highlighted:

a)     Katie Whybray would take over from David Johnson as incoming Audit Manager for Grant Thornton;

b)    The external auditors confirmed that the Statement of Accounts for the financial year 2024/25 was formally signed off on 23 February 2026. This signoff followed the completion of all outstanding audit work, including the resolution of matters relating to capital grants and prior period adjustments, enabling the accounts to be published the following day in accordance with statutory requirements;

c)     Initial preparatory work had commenced between the external auditors and the Council’s Finance Team to support delivery of the revised national backstop timetable. Grant Thornton confirmed that, in anticipation of the requirement for local authority accounts to be concluded earlier in future years, early planning discussions and preliminary testing had already begun with the intention of achieving sign?off of the 2025/26 Statement of Accounts by November 2026;

d)    The Committee noted that sector?wide updates provided by Grant Thornton were included within the supporting documentation appended to the report, offering members an overview of current national developments and emerging issues within the local government audit environment.

In response to questions, supported by Carolyn Haynes (Lead Accountancy Manager) and David Northey (Interim Service Director for Finance), the following wasdiscussed:

e)     The external auditor confirmed that the working relationship with the Council’s Finance Team remained strong and constructive. However, it was acknowledged that the principal challenge in meeting the revised national timetable would be the significant compression of the audit period. To mitigate this, Grant Thornton outlined plans to commence early testing, particularly in relation to capital grants, which were identified as a key area of delay in the previous year’s audit;

f)      The Section 151 Officer provided a detailed update on the Council’s financial risk environment, explaining that interest rates, inflation forecasts, and energy market developments were being closely monitored in conjunction with advice from the Council’s treasury management advisers;

g)     Steps were being taken to assess and mitigate inflationary pressures, manage short term borrowing exposure, and strengthen the Council’s overall financial resilience;

h)    Confirmation that the external auditors had reviewed the relevant elements of the PFI and lease accounting treatment as part of their audit work;

ACTION: Officers would produce a clear, one?page explanatory summary setting out the movements, assumptions, and reconciliations relating to PFI and debt liabilities, to be brought to the next meeting of the Committee

The report was noted by the Committee.

Update on External Audit Actions

David Northey (Interim Service Director for Finance) introduced the item and highlighted:

a)     Creation of a clear, rolling programme showing external audit recommendations, progress, and evidence;

b)    Officers working on a better tracking system .In response to questions, the following was discussed:

c)     Officers explained Plymouth has cleared most historical accounts, though some opinions remain “disclaimed” due to national issues with opening balances.

ACTION: A full written update would be brought to the next meeting.

The report was noted by the Committee.

Final Accounts 2024/25 Update:

Carolyn Haynes (Lead Accountancy Manager) introduced the item and highlighted:

a)     Adjustment of £26 million net reduction to capital grant receipts following review with Grant Thornton;

b)    Prior period adjustments were made where required;

c)     Accounts signed off 23 February 2026 and published 24 February 2026;

d)    The Council was in a rare “lull” with no pending accounts before 2025/26 preparation would begin.

.

The report was noted by the Committee.

Procurement Strategy 2024-2026 Year 2 Progress Report:

Holly Golden (Head of Procurement) introduced the item and highlighted:

a)     Waivers and non?compliance reduced in both volume and value;

b)    57% of spend placed with PL postcode suppliers were £235 million above target;

34% of spend with SMEs (Small to Medium Enterprises),, while the target was 27%.;

c)     88% of supplier invoices were paid within 15 days;

d)    Social value commitments were at 17% (slightly below 20% target) due to expansion into new categories (transport, waste, social care).

e)     Strong external praise for VCSE (Voluntary, Community and Social Enterprise) engagement.

f)      Improved contract management, supplier relationship management, and data-driven procurement

In response to questions, the following was discussed:

g)     Under the Council’s current approach, “Buy Local” was defined as spend with suppliers operating within PL-postcode areas. Forthcoming changes to legislation may provide additional flexibility, enabling the Council to reserve certain procurements more specifically for local suppliers within defined geographic boundaries;

h)    Whole-life considerations were embedded from the outset of a procurement exercise, including during project scoping, options appraisal, and the design of contract specifications. Market engagement, competitive tendering, and the structured evaluation of bids all contribute to identifying long-term value rather than short-term cost. Effective contract and supplier-relationship management throughout the duration of the contract ensures continued performance, the prevention of financial leakage, and opportunities for ongoing improvement and innovation;

i)      Highlighted the use of the ‘Find It in Plymouth’ portal to broaden market visibility and encourage engagement from new local businesses. Forthcoming legislative changes may permit certain procurements to be reserved for local suppliers;

j)      Cost pressures were being experienced by contractors as a result of global events, with officers noting that such pressures might effect pricing and contract sustainability depending on contract structure and market conditions;

k)     Suppliers could engage with the Council through two primary routes: the ‘Supplying the South West’ procurement portal and the ‘Find It in Plymouth’ platform.

The report was noted by the Committee.

Treasury Management Practices Principles and Schedules 2026/27:

Wendy Eldridge (Lead Accountancy Manager) introduced the item and highlighted:

a)     Annual publication was required under CIPFA Code of Practice;

b)    The report covered governance, risk management, borrowing strategies, working balances, counterparty risk assessments, and training;

c)     Interest rate uncertainty due to international conflict: early PWLB (Public Works Loan Board) borrowing secured at 4.37% vs 4.68% if delayed;

d)    Council was seeking to maintain a £20 million working balance;

e)     Short-term refinancing risks for 2026/27.

In response to questions, the following was discussed:

f)      Highlighted the increasing volatility in financial markets, in response, the Council had adopted a more flexible approach to borrowing in order to manage interest rate risk and secure favourable terms where possible.

The Committee agreed:

1. To approve the Treasury Management Practices Principles and Schedules 2026/27.

Internal Audit Strategy and Charter 2026/27:

Louise Clapton (Audit Manager, Devon Assurance Partnership) introduced the item and highlighted:

a)     The Strategy and Charter had been updated to align with Global Internal Audit Standards (mandatory from April 2025);

b)    It set out mandate, independence, access rights, and the Audit and Governance Committee responsibilities;

c)     Confirmed unrestricted access to records, systems, and personnel;

d)    Audit Committee responsibilities were reiterated.

The Committee agreed:

1. To approve the Internal Audit Strategy and Charter 2026/27.

Internal Audit Plan 2026/27

Louise Clapton (Audit Manager, Devon Assurance Partnership) introduced the item and highlighted:

a)     A risk based internal audit plan was developed drawing on the Council’s strategic and operational risk registers, wider national and sector specific issues, and the feedback provided by members during the dedicated Audit and Governance Committee workshop held on 29 January.

b)    The Internal Audit Plan would operate as a dynamic document, subject to formal quarterly review to ensure it remains aligned with emerging risks and organisational priorities.

Supported by Louise Clapton (Audit Manager, Devon Assurance Partnership), Tony Rose (Head of Devon Assurance Partnership, Devon Assurance Partnership) and David Northey (Interim Service Director for Finance) in response to questions, the following discussion took place:

c)     The potential implications of Local Government Reorganisation (LGR) were being actively monitored, cross-authority collaboration and information-sharing arrangements were in place to ensure emerging risks were identified and managed appropriately

d)    There was a need for greater visibility over the risks associated with the Council’s transformation and savings programmes.

The Committee agreed:

1. To approve the Internal Audit Plan 2026/27;

2. To note that the plan would be continuously reviewed and updated during the year to reflect emerging risks, organisational priorities and changes in the operating environment, with material changes reported back to the Committee.

Whistleblowing Policy

Liz Bryant (Service Director for Legal Services) introduced the item and highlighted:#

a)     A single amendment was proposed, clarification that any disclosure to an MP should be made to the employee’s own constituency MP;

b)    The policy was up to date and reflected best practice;

c)     Contractors were covered via contract clauses and public availability of the policy.

In response to questions, the following was discussed:

d)    Limitations of the Public Interest Disclosure Act and sought assurance that the Council’s cultural and procedural arrangements provided robust protection for individuals raising concerns under the whistleblowing policy;

e)     The complaints system for the Council  provided with case reference numbers for matters.

The Committee agreed:

1. To approve the current version of Whistleblowing Policy.

Pre-election guidance

Liz Bryant (Service Director for Legal Services) introduced the item and highlighted:

a)     Review commissioned following Armada Way findings; external legal advice confirmed the pre-election guidance had been overly restrictive;

b)    New draft guidance aligned to LGA (Local Government Association) model, clearer and shorter.

ACTION: To remove Guildhall from list of available rooms due to closure.

ACTION: Group whips receive a summary.

ACTION: Discussion on the word “generally” in key principles; clarified as a prompt to seek Monitoring Officer advice.

ACTION: Monitoring Officer would finalise guidance, incorporating comments.

The Committee agreed:

1. To note the contents of the review;

2. Endorse the proposal to revise and shorten the Council’s guidance, aligning it with the LGA’s annual guidance;

3. Consider the draft Guide to Pre-election Publicity;

4. The Monitoring Officer would finalise the redrafting of the guidance, based on any comments made by the Committee, ensuring legal consistency.

Action Log

The action log was noted by the Committee

Work Programme

ACTION: Update on Local Government Reorganisation (LGR) arrangements at an appropriate future meeting.

The work programme was noted by the Committee.