Îʶ¦ÓéÀÖ

• Mike Usher, Non-Executive Director and Chair of WG ARAC and CS&I ARAC
• Nigel Reader, Chair – Independent Member, HSCEY ARAC
• Gareth Pritchard, Acting Chair - Independent Member, ECWL ARAC
• Mel Doel, Acting Chair - Independent Member, EET ARAC

Officials

• Andrew Goodall, Permanent Secretary
• Sioned Evans, Director General, ECWL Group
• Tracey Burke, Director General, LGHCCRA Group
• Judith Paget, Director General, HSC&EY Group / NHS Chief Executive
• Tim Moss, Chief Operating Officer
• Peter Ryland, Chief Executive, WEFO
• Dean Medcraft, Director of Finance
• David Richards, Director of Propriety and Ethics
• Glyn Jones, Chief Digital Officer
• Dom Houlihan, Director of People & Places
• Kim Jenkins, Deputy Director Accounts, Governance & Grants
• Helen Morris, Deputy Director Audit, Assurance & Counter Fraud
• Richard Harries, Audit Wales
• Clare James, Audit Wales
• Matthew Mortlock, Audit Wales

Also present

• Head of Corporate Governance Centre of Excellence
• Deputy Head of Internal Audit
• Head of Financial and Technical Accounting
• Head of Accounts - Consolidation
• Senior Auditor – Audit Wales
• ARAC Secretariat

1.1 No declarations of interest were received in relation to agenda items.

2.1 Subject to a minor amendment to provide clarity, the minutes were agreed as a complete and accurate record.

2.2 The committee endorsed the proactive approach taken to implement agreed actions. An update was received on open actions and the committee noted that several would be addressed when revised iterations of documents, such as the risk register, were presented at the next meeting.

The Permanent Secretary provided the committee with an update on several key areas, including:

• The Prif Weinidog’s delivery priorities which need to be considered alongside the residual Programme for Government and core and statutory duties. It is anticipated that, over the next few weeks, Cabinet will sign-off the performance aspects of the revised priorities.
• The UK Covid Public Inquiry continues to take a great deal of officials’ time. The recommendations from Module 1 are being considered and officials are preparing for the remaining modules.
• Key policy announcements relating to the Visitor Levy and the Sustainable Farming Scheme were made during week commencing 25 November.
• The mechanics of the Legislative Programme are being reviewed to ensure there is sufficient expertise and capacity to maximise the likelihood of successful delivery.
• The focus on resilience and wellbeing across the organisation. The results of the 2024 staff survey are due to be published, and initial results will be considered by the Executive Committee at the end of November.

4.1 The committee received an update on the review, by Audit Wales, of Îʶ¦ÓéÀÖ Government’s Consolidated Accounts for 2023-2024, which are due to be signed and laid before the Senedd on 29 November.

4.2 Audit Wales presented their ISA 260 document which outlines the conclusions of their review of the consolidated accounts. Emphasis was drawn to the effective, flexible and pragmatic working relationship between both parties. The committee was pleased to note that Audit Wales are proposing unqualified audit opinions on the accounts. There is one narrative comment in the opinion regarding the non-disclosure of 2 elements in the Remuneration Report.

4.3 The ISA 260 identified some areas where the control framework can be enhanced and these will be detailed in a Management Letter to WG which will be provided in early 2025. The committee was content to recommend that the Permanent Secretary sign the accounts and the Letter of Representation.

4.4 The committee acknowledged the complex nature of the accounts process due to the breadth of functions, the enlarged consolidation accounting boundary and changing audit standards. The committee endorsed the collaborative approach involving the Central Accounts Team, Group Heads of Finance and Audit Wales and the proactive focus on lessons learned as work progresses.

4.5 The committee expressed its thanks to colleagues from Îʶ¦ÓéÀÖand Audit Wales for their work in preparing and reviewing the consolidated accounts within anticipated timescales.

The committee received an update on the work of Audit Wales and attention drawn to the following areas:

• A consultation on the ‘Code of Audit Practice of the Auditor General for Wales’ had been launched and has been shared with WG. The deadline for responses is 27 January 2025.
• The review of Local Government Financial Sustainability is going through final clearances and is likely to be published in December 2025.
• The review of cancer services and strategic direction is also going through clearance and is likely to be published in early 2025.
• Scoping work is continuing for the review of the Senior Public Service in Wales.

6.1 The committee received updates on the Internal Control Questionnaire process for 2024-2025 and the revision of Îʶ¦ÓéÀÖ Government’s Risk Appetite Statement. The committee noted the triangulation of assurances, endorsed the proposed approaches and welcomed the intentions to provide greater clarity in certain areas and to provide practical guidance to staff

6.2 The committee considered IT related risks that included the sufficiency of budgets at a time when the costs of licences and contractors are increasing, the build-up of legacy debt on corporate applications, business continuity and the continued support of systems by suppliers.

6.3 Whilst the committee endorsed the various actions being taken to mitigate these risks and increase cyber resilience, it remained sufficiently concerned to request an update on the management of these risks in due course.

7.1 The committee received an update on the Îʶ¦ÓéÀÖ Government’s financial position as at Period 7. Since this financial position was prepared, the UK Budget Statement has taken place and an additional £1.7 billion received in relation to 2024-2025 and 2025-2026. There are ongoing discussions within Cabinet on how to use this funding to best meet priority areas. The 2025-2026 draft Îʶ¦ÓéÀÖbudget is due to be published on 9 December.

8.1 The committee received an update on the work of internal audit and the key messages contained within recent reports.

ARAC Secretariat
Date of Publication – February 2025