finance and investment committee meeting public session...the committee discussed the 2015/16...

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Finance and Investment Committee MeetingPublic Session

Approved Minutes from 12 May 2015

Present: Stephen Lightfoot (SL) Non-Executive Director (Chair)David Parfitt (DP) Non-Executive DirectorElizabeth Woodman (EW) Non-Executive DirectorJonathan Reid (JR) Deputy Chief Executive & Director of Finance & EstatesGareth Baker (GB) Director of Transformation and Commercial DevelopmentRichard Curtin (RC) Director of Operations

In attendance: Janice Needham (JN) Non-Executive Director DesignateSue Sjuve (SS) SCT ChairEd Rothery (ER) Deputy Director of FinanceSiobhan Melia (SM) Commercial Director

Minute taker: Tim Blatt (TB) Head of Financial Management

Item No. Item Description Action

1.0 Meeting Administration

SL welcomed SM to her first meeting.

1.1 Apologies for absence from this meetingPaula Head (PH) Chief Executive

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1.2 Declarations of interest

SS declared that she was a director of Saxon Weald.

1.3 Minutes of previous meeting

The minutes were received and approved.

1.4 Action schedule from previous meeting

The Committee noted progress against the actions and the following matters were agreed:

JR agreed to send the final draft of the Committee Annual Review to SL for final review beforesubmission to the Board

Action 2.1 from 10 March – agreed to close

Informatics Strategy - agreed to close.

1.5 Work Programme 2015/16

The Committee reviewed the Work Programme for 2015-16. The following matters were noted:

It was confirmed that the Partnership Strategy should be discussed at the June meeting.

JN noted that with the move to FT the requirements of the Governors would need to be reviewed. It wasagreed that this should be reviewed in September.

It was agreed to add ‘HDD feedback’ in September as well.

SL commented that he felt that the programme was biased towards Finance and that he would like to see abroader agenda with transformation featuring more heavily.

JR /09.06.15

JR/ 09.06.15

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JR to amend programme to reflect the above comments

2.0 Financial Performance 2014-15

2.1 Month 12 position – Board Finance Report

The Committee noted the draft Month 12 financial position.

EW noted the improved cash flow and asked if it was likely to continue. ER confirmed that action would betaken where it could be but that it was not all in our control.

DP asked if it was still subject to audit. ER confirmed that it was and that there were a couple of areasraised including one item of potential disagreement but that overall it was progressing well.

SL commented that he was very pleased with the draft result with improved forecasting of out-turn; it wasconfirmed that the waterfall charts had proved very useful.

2.2 Month 12 – Bank & Agency Spend

The analysis of bank and agency spend was reviewed and it was noted that overall there had been areduction in agency spend of 8%.

The Committee welcomed this reduction but recognised that it should be viewed as part of the overallpicture. It was noted that there was a need to resolve recruitment issues as part of the staffing strategy andthat agency spend should not be viewed in isolation.

2.3 Month 12 – Better Payments Practice Code

The Committee noted the analysis of the BPPC performance. DP queried how the impact of the ledgermigration affected the data and ER explained that the close down of the ledger for 14 days in Decemberresulted in some delays in payments which could not be caught up. JR noted that a special effort had beenmade during the year to ensure that the smaller suppliers were paid on time.

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2.4 Progress on 15/16 Efficiency Programme

The Committee noted the on-going work to ensure delivery of the 2015/16 programme. It was noted that,whilst the Trust had issued differing internal targets, we should refer to the official efficiency target of £6.9mto avoid confusion.

JR noted that BDO had been brought in to assist the managers with the programme recognising theadditional pressures that this would put on them.

3.0 Strategy & Planning

3.1 Strategic Capital Programme

The Committee discussed the 2015/16 Capital Programme.

EW suggested that the programme should be split in 3 ways – Standard, Improving and Transformationaland there was a discussion around the prioritisation process.

The Committee formally agreed to the internally funded capital plans for 2015/16 and requested furtherdetail on the external funded capital plans for strategic capital.

3.2 Refreshed Investment Policy

The Refreshed Investment Policy was approved.

3.3 Preparations – HDD Readiness Review

It was noted that this continued to progress well.

3.4 Estates Strategy Refresh

This refreshed Estates Strategy was noted.

JR/ 07.07.15

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Date of Next Meeting9 June 201508.30 – 10.30 ELT Meeting Room, The Annexe, Horsham

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Audit CommitteeMinutes of meeting held on 14 April 2015

Present: David Parfitt, Non-Executive Director (DP) (Interim Chair)Stephen Lightfoot, Non-Executive Director (SL)Maggie Ioannou, Non-Executive Director (MI)

In Attendance Sue Sjuve, Chair (SS)Janice Needham, Non-Executive Director Designate (JN)Elizabeth Woodman, Non-Executive Director (EW)Jonathan Reid, Director of Finance & Estates (JR)Helen Robinson, Interim Company Secretary (HPR)Ed Rothery, Deputy Director of Finance (ER)

Paul King, Director of Audit Ernst & Young (PK)Michael Townsend, Regional Managing Director TIAAKevin Maloney, Audit Manager TIAA (KM)Chris Lovegrove, Counter Fraud Specialist Manager (TIAA)

[This meeting was observed by NICHE consulting as part of the QGAF assessment]

Item No. Item Description Action

1.0 Apologies for non attendance

Susan Marshall Chief Nurse; Simon Mathers Senior Manager E&Y

2.0 Minutes of previous meeting held on 14 April 2014

Amendments to minutes:

Janice Needham is a Non-Executive Director Designate and MichaelTownsend is Regional Managing Director.

The minutes of the previous meeting were approved, subject to theseamendments.

3.0 Actions from previous meeting held on 14 April 2014

The updated action schedule was reviewed and noted.

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4.0 Audit Committee Workplan 2014/15

The work plan was noted and discussed. PK confirmed there was norequirement for the Trust’s Quality Accounts to be audited – however, theTrust has requested an audit at the instigation of the Audit Committee. Adiscussion took place in respect of the Quality Accounts and how they hadbeen prepared and the scope of the audit work; PK confirmed that EY willlook at the data (including the key indicators) included in the QualityAccounts as they are undertaking an overall assurance review.

It was agreed that the TIAA reports for the 2014/15 only will be loaded ontoBoardPad, in a separate Reading Room; Debbie McElroy to action this.

It was agreed at the Committee that an informal meeting could be held toreview the draft annual accounts, at the discretion of the Chair.

DP raised the question of whether we should consider re-tendering for ourinternal and external audit services as it is good practice to periodicallyreview the role of all of our professional advisors; SS agreed that it wasgood practice to do so every five years. It was agreed that this should beconsidered at the Committee’s September meeting.

JR confirmed that Counter Fraud also needed regular review and noted thatthere is an action in train to develop an action plan to respond to NHSProtect, who undertook a review earlier in the year with positive outcomes.

DP asked if the HDD went through this committee and was anythingrequired at this stage. JR noted that the HDD review is likely to consider theoverall effectiveness and operation of the Committee.

Discussions took place around the implications for SCT of achieving FTstatus by the end of the year and plans in place to deal with possiblegovernance implications of this; SS confirmed that the Secretariat doeshave a plan for the early days of FT status but it did need re-visiting.

KM/DMc

JR

5.0 Audit Committee Annual Report

JR confirmed he had prepared a draft report for attendees to take away andreview and it was agreed it was not appropriate to discuss at this meeting.SS noted the need to use the specified SCT format, and JR committed toreviewing it and then sharing with DP.

Discussions took place with regard to how quickly the Trust signs offinternal audit reports; JR noted that the Trust should refresh the reportingprotocol between SCT and TIAA, and it was agreed that the feedbacktimeline will be confirmed when the new template is circulated to committeemembers. DP requested it be sent as a Word document, with trackchanges. JR will share the finalised proposal for DP to consider in advanceof the next meeting.

JR

JR

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6.0 TIAA Internal Audit 2014/15 Progress Update

KM confirmed five final internal audit reports had been issued and directedthe attention of the Committee to the bullet pointed summaries.

MI expressed her concern at the delay in agreeing the draft reports with theexecutive and therefore issuing final reports, particularly with regard toresuscitation, agency staff and lone working, and requested an explanationfor the delay. MI also stated that she was not happy with “limitedassurance” in these areas, and requested that the Executive Team reviewthe key issues to establish whether enough was being done to respond tothe risks raised. In respect of reporting,

SL stated that we need sight of the timeframe for the reports to be assuredthat correct priorities are being given to actions.

SL requested sight of the draft report with regard to CAPITA; as SCT ishaving discussions with regard to strategic relationships with them at theFinance & Investment Committee meeting in May.

In respect of the activity audit, SL asked how we canvas commissionerthoughts on our data quality. It was agreed that we re-test the data, as wedo have some available time, as part of the rolling data quality review.

KM/JR

KM

7.0 TIAA Internal Audit Recommendations Tracker

Hard copies of the tracker were circulated at the meeting by KM; JRsuggested that the Executive Team review should review this at thePerformance Quality & Governance meeting on Monday 20 April, as theyhad not seen it prior to circulation.

DP requested a more formal process for the escalation of audit issues to bedeveloped by the Executive Leadership Team in advance of the next Auditmeeting, alongside a full and complete audit tracker.

The Committee noted the delay in finalising recommendations and the needfor actions to be agreed and then implemented. The Committee echoed theconcern over the adequacy of the follow-up process, both in terms ofreporting and the apparent responsiveness of the Trust. JR committed todiscussing this with the Executive Leadership Team, noting that TIAAannually reviewed follow-ups under the old process, and that this approachhad been effective – the Executive Team will look to refresh their approachto follow-ups to ensure that the new ‘devolved’ model is fully effective. JRnoted, and will share with the Executive Team, the Committee’s concernover the apparent delay.

JR

KM

JR

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8.0 Finalised TIAA Internal Audit Plan 2015/16

SL expressed concern about the draft plan on the basis of the precedingdiscussions (particularly the number of audits which had not been fullycompleted by the year end); he confirmed that action was needed now asaudits are not fully effective if actions are not completed at pace. It wasagreed that prioritisation of 2014/15 process needs to be completed; amore granular programme needs to be produced for 2015/16 andpresented to the Audit Committee.

JR to take to the Performance Quality & Governance Committee onMonday 20 April – he will revisit the audit plan and send it to DP and SS toagree as to how we take this forward; it was agreed we need to agreetimescales against how we measure delivery and implementation of auditfindings.

JR

9.0 LCFS 2014/15 Progress Update and Draft Plan 2015/16

With regard to the Salary Overpayments final report, MI expressed herconcern around the publication of names in the report; SS confirmed thatthe Trust and the Committee have a policy of not publishing names, and CLagreed to remove these and avoid publishing them in the future.

CL confirmed that the Work Plan had been discussed with JR before beingbrought for approval and asked for comments; the Work Plan was approvedby the Audit Committee.

EW asked how easy it was for a manager to spot an irregular payment inthe reports that are regularly sent to them - it was agreed that movingforward positive reporting was to be encouraged across the wholeorganisation.

CL

10.0 External Audit 2014/15 Progress Report

PK gave an update – the audit was progressing to plan, and the areas offocus were as discussed in the planning submission presented to theCommittee. PK also described the arrangements for reporting to theCommittee. The report was noted.

The Committee discussed the arrangements for off-payroll appointments innursing (non-framework agency), and ER confirmed that there was scopeto develop a Trust-wide arrangement. This was in train and under regularreview by the Finance and Investment Committee.

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11.0 Accounting Policies 2014/15

ER presented the Trust’s proposed accounting policies based upon the2013/14 policies. MI stated that there were some missing figures in thereport; ER confirmed we awaited figures as the accounts were still underpreparation. The Committee approved the accounting policies, subject tothe minor textual corrections noted by Committee members.

12.0 Draft Annual Governance Statement 2014/15

The draft Governance Statement was received and noted – ER hadpreviously circulated and had reflected the key comments.

13.0 Going Concern

The Committee reviewed the paper supporting the adoption of the goingconcept basis for the preparation of the 2014/15 accounts. They approvedthe adoption of this basis, subject to some minor textual amendments.

14.0 Any Other Business

With regard to schedules for F&I, Audit and the Board committee meetings,HPR confirmed she would be scheduling 1:1’s with each executive andNED over the next few weeks. HR

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Board Meeting30 April 2015

Agenda Item: 07 Enclosure: C

Title: Annual report of the Quality Committee

Purpose: Approval x Assurance Discussion Briefing

Summary:

1. The Committee is required to carry out an annual review of its performance over the pastyear in an annual report to the Board.

2. Quality Committee has carried out this review, the findings of which are attached.

Recommendation:

The Board is asked to approve the Quality Committee’s annual report and Terms ofReference.

CQC Domains Patient Safety Clinical Effectiveness Caring/responsive Well Led

Relevance to Strategic Goals: The Quality Committee provides assurance to theBoard that care is safe, effective and compassionate

Equality and Diversity: Assurance received through equality reports for each area.

Prepared by (including job title):Maggie Ioannou, NED Chair of QualityCommittee

Presented by (including job title):Maggie Ioannou, NED Chair of QualityCommittee

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Quality Committee annual report

1. Committee membershipand meeting attendance:

The committee has met 8 times in the year April 2014-March 2015

16.04.14

21.05.14

18.06.14

23.07.14

17.09.14

19.11.14

13.01.15

10.03.15

% attendance

Maggie Ioannou NED(Chair) 100%David Standfast NED 37.5%David Parfitt NED 62.5%Richard Quirk (MedicalDirector)

87.5%

Susan Marshall (Chief Nurse) 100%Sue Sjuve In

atten

37.5%(excl. in attendance day)

Richard Curtin Inatten

from12p

75%(excl. in attendance day)

Paula Head from12p

50%

The current Terms of reference state – (objectives):

The terms of reference were reviewed and revised by thecommittee on the 21st of May, 2014.

1.1 Conclusion:

2. Objectives (“Purposes”): Achievement of objectives- assurance received through thefollowing areas

Patient Safety Development and implementation of QEWTT Francis and Cavendish report action plan Quality impact assessments Falls and pressure damage and VTE improvements Infection prevention and control Orchid view learning and actions Raising concerns policy review Mortality Review Safeguarding children and adults, Looked After Children Review of risk process Review of serious incidents, action plans and policy Safer Staffing

Clinical Effectiveness Clinical audit plan – progress and recommendations Medicines management, administration and controlled drugs Quality Improvement Plan progress NICE compliance Specific service reports:

- wheelchair service- school nursing- Horizon Unit- Community Nursing- Length of stay action plan- End of life care

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Caring/Responsive Patient experience, FFT, complaints Equality of access for people with learning disability Dementia strategy Equality and Diversity action plan progress

Well led People Strategy deliverables Workforce – recruitment. Retention, sickness, mandatory

training Staff engagement Quality of appraisals Supervision Revised staff performance management policy

2.1 Conclusion: The Committee has fully met its objectives.3. Proposed changes to

terms of reference:Reasons for changes

There are no proposedchanges to the Terms ofReference.3.1 Conclusion

BOARD MEETING JUNE 2015


Title: Annual Report of the Finance & Investment Committee

Purpose: Assurance: X Decision: Discussion:

Summary:

At its meeting on 25 April 2013, the Board noted with approval, that the annual boardevaluation exercises would comprise reviews of (i) the whole board; (ii) individualdirectors; and (iii) main board committees

In respect of committees, it was agreed that (i) committees would undertake assessmentsagainst objectives; and (ii) review their terms of reference, at their meetings in or close toSeptember 2014.

The attached paper combines the Finance & Investment Committee’s self-evaluationagainst its objectives carried out in October 2014 and the Committee Chair’s annual reportcovering the 2014/15 year with the following conclusions:o The Committee met frequently and was well attended by non-executive and

executive directors throughout the year.o The Committee achieved its objectives by convening regular meetings to review the

Trust’s financial performance and key strategy developments. The Committee alsoused the experience of its members and sought evidence from several differentsources to provide assurance to the Board during the year.

o The Committee has reviewed its own effectiveness, and has identified a number ofstrengths and areas for development, which will be addressed in the operation of theCommittee in 2015/16.

o The Committee has completed a review of its Terms of Reference and recommendsthat the Board approves the proposed changes.

Recommendation:

That the Board notes the Committee’s self-evaluation and Annual Report for assurance. Agrees the Committee’s revised Terms of Reference noting that the Committee has

delegated authority to make decisions as indicated in the ToR.

CQC Outcomes : This paper supports the Trust objective to remain a well-led organisation.

Equality and Diversity: Assessment: Yes

Any impact: None

Prepared by:Stephen Lightfoot, Chair F&I Committee

Presented by:Stephen Lightfoot Chair F&I Committee

Report of the Committee to the Board: FINANCE & INVESTMENT COMMITTEE

1. Membership and Attendance: 2014/15

Apr May Jun July Sep Oct Nov Dec Jan Feb Mar %Attendance

2014 2014 2014 2014 2014 2014 2014 2014 2015 2015 2015

Members of Committee

Stephen Lightfoot (NED Chair) 100%

Martin Sambrook (NED) 91%

Jonathan Reid (DoF) 100%

Richard Curtin (COO) 73%

Other Attendees

Paula Head (CEO)

Gareth Baker (DoT)

Richard Quirk (MD)

Ed Rothery (Deputy DoF)

Tracey Paton (Deputy DoI)

Sue Sjuve (NED Trust Chair)

David Parfitt (NED)

Elizabeth Woodman (NED)

Janice Needham (NED Desig)

1.1 Meeting Frequency

1.2 Membership

1.3 Attendance

1.4 Quorum

11 Committee meetings were held in 2014/15 and the samefrequency of meetings is planned in 2015/16.

The members of the Committee include a NED Chair, NED ViceChair and NED Chair of the Audit Committee, plus the ExecutiveDirector of Finance and Chief Operating Officer.

Following Martin Sambrook’s resignation on 2 April 2015,Stephen Lightfoot will continue as NED Chair of the Committee,Elizabeth Woodman will be the NED Vice Chair of the Committeeand David Parfitt will be the NED Chair of the Audit Committee.

The Committee was attended regularly by the CEO, Director ofTransformation, Deputy Director of Finance, Deputy Director ofInformatics and NED Trust Chair throughout the year.

Other Directors, Service Managers and Observers were alsowelcomed to the Committee during the year.

Newly appointed Commercial Director Siobhan Melia will becomea regular attended of the Committee in 2015/16

A quorum is any 3 members of the Committee, including at leasttwo NEDs and one Executive Director

The Committee was quorate for every meeting during the year… Sue Sjuve deputised for Martin Sambrook in November 2014… Paula Head was present when the COO was unable to attend

1.5 Conclusion: The Committee met frequently and was well attended by non-executive and executive directors throughout the year.

2. Objectives (“Purposes”): Achievement of objectives

.1 The Committee will review indetail all aspects of financialreporting, financial managementand standing, including financialand investment policy. It willidentify and monitor progressagainst risks related to theseareas and provide informationand assurance to the Board.

The Committee reviewed the monthly financial reports andprogress of the efficiency programme at every meeting.

Additional deep dives on bank & agency spend and activity levelswere conducted in September, October, December and January.

The capital programme, investment strategy and treasurymanagement policies were all reviewed during the year.

The risks to the financial outturn were reviewed every monthfrom November to the year end and additional information wasrequested to provide assurance to the Board.

The process for calculating reference costs and new service linereporting metrics were considered in May and December.

Minutes and verbal updates of each Committee Meeting werepresented at each Board Meeting during the year.

.2 The Committee is accountablefor providing assurance to theBoard on all performanceaspects relating to finance andinvestment.

The Committee had an active involvement in the iterativedevelopment of the Trust LTFM at four meetings during the year.

The Trust annual business and financial planning process was alsoreviewed at seven meetings during the year, with Committeerecommendations incorporated into the final Board proposals.

The Deputy Directors of Finance and Informatics have routinelypresented to the Committee for their own development and toprovide more detail on specific topics.

Service Managers presented their cost saving plans to theCommittee in July & December to provide additional assurance.

Capita attended the Committee in January to present and answerquestions on their strategic proposals.

A summary table of all Committee agenda items is included in theAppendix of this report.

.3 The Committee will monitor theperformance of the commercialstrategy of the Trust, itstransformation programme andthe strategies dealing withinformatics, estates andstrategic partnerships along withany other matters referred to itby the Board from time to time.

The Committee has held public and private sessions at everymeeting so that it could provide confidential support andchallenge on developing strategies and commercial opportunities.

Contract performance and commercial developments have beenreviewed at every meeting during the year.

The Committee reviewed and contributed to the development ofthe Commercial, Partnership, Informatics and Estate Strategies.

The Committee reviewed several transformation proposals fromCapita during the year.

The Committee Chair met Capita on a couple of occasions outsideCommittee meetings to provide additional input on the Trustexpectations of the programmes they are working on.

The Committee Chair also met members of the Informatics,Performance and SystmOne Teams to gain additional assurance.

2.4 Conclusion: The Committee achieved its objectives by convening regularmeetings to review the Trust’s financial performance and keystrategy developments. The Committee also used the experience ofits members and sought evidence from several different sources toprovide assurance to the Board during the year.

3. Effectiveness Self-Appraisal of Committee Strengths & Development Needs

3.1 Strengths Attendance and focus at meetings is good with robust chairingand constructive dialogue between Non-Executives & Executives.

Use the experience of committee members for exploratorydiscussions around new and complex issues.

Additional assurance is gained by the Committee through theattendance of Deputies and Service Managers at regular intervals.

The balance between assurance and developmental support forExecutives is well-maintained. For example, where theCommittee did not feel assured on the robustness of plans forfinancial recovery, an exceptional meeting was convened.

The standing invitation to the Trust Chair and CEO provides anopportunity for additional assurance to the Board.

3.2 Areas for Development The administration of the Committee is adequate, but wouldfunction more efficiently with consistent professional supportfrom the Company Secretariat.

Committee papers involving financial investments and servicedevelopments need to describe routinely their return oninvestment and profit contribution in more detail.

Scrutiny of transformation programme delivery and governanceneeds to be strengthened – reflecting improvements requiredwithin the underlying programme governance for key projects,which has been recognised by the Executive Team.

The Committee agenda needs to be broadened so that sufficienttime is spent on our commercial, contract and servicedevelopments to enable all members to understand the externaldrivers of the Trust’s financial position.

3.3 Conclusion The Committee has reviewed its own effectiveness, and hasidentified a number of strengths and areas for development, whichwill be addressed in the operation of the Committee in 2015/16.

4. Terms of Reference

4.1 Review of Terms of Reference The Committee reviewed its Terms of Reference in October 2014and made some relatively minor suggestions to improve thewording to the previous substantive Company Secretary in theminutes of the October Committee Meeting:- Being clear that the Committee is responsible for strategic

commercial decisions and not all commercial decisions- Including a financial threshold of £1 million per year for

commercial decisions which need Committee approval- Inviting the CEO to become a member of the Committee to

ensure that the Committee can benefit from her input on allmajor investment and strategic decisions taken on behalf ofthe Board.

4.2 Conclusion The Committee has completed a review of its Terms of Referenceand recommends that the Board approves the proposed changes.

APPENDIX – Agenda Topics for Finance & Investment Committee in 2014/15

Apr May Jun July Sep Oct Nov Dec Jan Feb Mar

2014 2014 2014 2014 2014 2014 2014 2014 2015 2015 2015

Financial Performance

Monthly Financial Report

Risk to Financial Outturn

Efficiency Programme

Contract Performance

Activity Analysis

Bank & Agency Spend

Reference Costing Process

Service Line Reporting

Better Payment Practice

Service Presentation

Financial Planning

Business Planning

LTFM

Capital Planning

Investment Strategy

Treasury Management

HDD Readiness Review

Commercial Development

Commercial Developments

Commercial Strategy

Partnerships Strategy

Transformation Programmes

Estates Strategy

Informatics Strategy

Organisational Design Programme

Strategic Partnership

Capita Strategic Proposals

Committee Review

Review Terms of Reference

Annual Report of Committee

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BOARD MEETING 25th JUNE 2015

Agenda Item: TBC Enclosure: N/A

Title: Annual Report of the Audit Committee

Purpose: Assurance: X Decision: X Discussion:

Summary:

At its meeting on 25th April 2013, the Board agreed that the annual board evaluation exerciseswill comprise reviews of (i) the whole board; (ii) individual directors; and (iii) main boardcommittees

In respect of committees, it was agreed that (i) committees would undertake assessmentsagainst objectives; and (ii) review their terms of reference, at their meetings in or close toSeptember 2014.

The attached papers are the Audit Committee’s self-evaluation carried out in April and May2015, and the Committee Chair’s annual report covering the financial year 2014/15, with thefollowing conclusions:o The Committee met regularly throughout the year and meetings were well attended by

both the non executive and executive directors.o The Committee achieved its objectives through agreeing an internal audit work

programme for the year and regularly reviewing the internal control weaknessesidentified by the auditors, albeit it recognises that the completion of the internal auditreports and their subsequent follow up was not as rapid as it should have been and theexecutive have taken actions to address the matter.

o The Committee has reviewed its own effectiveness, identifying a number of strengthsand areas for improvement which are being addressed.

o The Committee has reviewed its Terms of Reference and is not proposing any changesto those previously agreed by the Board.

Recommendation:

That the Board notes the Committee’s self-evaluation and annual report for assurance. Agrees the Committee’s terms of reference remain as currently approved; noting that the

Committee has delegated authority to make decisions as indicated in the ToR.


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Any impact: None

Prepared by:

David Parfitt, Chair, Audit Committee

Presented by:

David Parfitt, Chair, Audit Committee

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Report of the Committee to the Board AUDIT COMMITTEE

1.1 Membership and attendance: Meetings held in the financial year 2014/15May2014

June2014

Sept2014

Dec2014

Feb2015

% applicable attendance

Martin Sambrook (Chair until 2nd April 2015) 100%David Parfitt (Chair from 30th April 2015)* n/a n/a n/a n/a n/a n/aMaggie Ioannou (Chair, Quality Committee) 100%Stephen Lightfoot (Chair, F&I Committee) 100%* David Parfitt was appointed a member of the

Committee in March 2015 and became Chairof the Committee on 30th April 2015 followingMartin Sambrook’s resignation from theboard.

Membership consists of the nominated Chair of the Committee,the Chair of the Finance and Investment Committee and theChair of the Quality Committee. All of whom are NEDs.

The Director of Finance and Estates and the Director of Nursinghave a standing invitation to attend.

In addition, the Chair of the Trust and the Chief Executive havea standing invitation to the Committee.

1.2 Conclusion: The Committee met five times in the year and was quorate ateach meeting.

2.1 Objectives (“Purposes”): Achievement of objectives:

The Committee has primary responsibility formonitoring and reviewing financial and otherrisks and associated controls, corporategovernance and financial assurance.

The Committee has an annual workplan which is used in ensuring that itdischarges its responsibilities. In addition to the annual review of thefinancial statements and associated documents, the Committee alsoreviews at each meeting the work of internal audit, external audit, localcounter fraud and other relevant bodies. In respect of the financial year2014/15, the Trust received an overall rating of ‘reasonable’ assurancefrom the Head of Internal Audit and unqualified audit opinions fromexternal audit from the viewpoint of both the financial statements andvalue for money.

The Committee shall provide the Board with ameans of independent and objective reviewof financial and corporate governance,assurance processes and risk managementacross the whole of the Trust's activitiesgenerally and in support of the annualgovernance statement. In fulfilling thisfunction the Committee shall be entitled torely upon reviews of clinical risks undertakenby the Quality Committee of the Trust

The Committee reviewed a draft of the Annual Governance Statement,and received a presentation from the Chief Executive on it together withthe final version. It triangulated this with its own work, and took intoaccount the specific work on the system of internal control by both theinternal and external auditors. The Chair of the Quality Committee is amember of the Committee, thereby facilitating a closer workingrelationship with the work of that committee including clinicalgovernance. In addition, the Chair of the Finance & InvestmentCommittee is also a member which links the Audit Committee into thework of that Committee does with regard to financial, investment andcommercial matters. The three Chairs meet together to ensure alignmentof work programmes. The Committee has noted the good progress on theRisk Management System undertaken by the Trust Board and, as this hasmatured, will be assuming responsibility for assurance in a number of keyareas in relation to risk and risk management.

In addition, the Audit Committee shall: Provide assurance of independence for

external and internal audit;

The Committee reviews the work of internal and external audit ateach of its meetings. It also participates in the arrangements relatingto the appointment of internal and external audit, including the localcounter fraud service. The Committee has regular opportunities for

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Ensure that appropriate standards are set andcompliance with them is monitored in all areasthat fall within the remit of the AuditCommittee; and

Monitor corporate governance (e.g.compliance with terms of the licence,constitution, codes of conduct, standingorders, standing financial instructions,maintenance of registers of interests).

confidential discussions with the Head of Internal Audit and theDirector of External Audit.

The Committee also has undertaken scrutiny of compliance with keycomponents of corporate governance, both through thecommissioning of internal and external audit reviews, and directly – itreceives and reviews details of losses and compensation payments,and reviews waivers and tenders.

2.2 Conclusion: The Committee achieved its objectives by convening meetings todeal with matters referred to above although, as noted inattached report, it has expressed its concern to the ExecutiveLeadership Team over the number of audit reports that werewaiting finalisation and the need for a robust approach to trackinginternal audit recommendations to their completeimplementation. These issues are being addressed by the ELT.

3.0 Terms of Reference The Committee has reviewed its terms of reference andrecommends that these remain unchanged

3.1 Conclusion The Committee recommends, for approval by the Board, that itsterms of reference remain as currently approved.

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Appendix A: Annual Self Review of the Committee

Annual Review of the Audit Committee

Introduction

This annual review covers the financial year 2014/15. The Board agreed new Terms ofReference for the Audit Committee in September 2013 which included broadening itsmembership to include the chairs of both the Quality Committee and Finance &Investment Committee as well as supporting a greater focus on both clinical andcorporate governance. These were subsequently reviewed, in September 2014, by theCompany Secretary and a number of relatively minor amendments were made.

Membership of the Committee

The Committee comprises of three Non-Executive Directors, one of whom is chair, with anumber of Executive Directors and their support staff in attendance as appropriate. The chair’sof the Finance and Investment Committee and the Quality Committee are both members. TheChief Executive has a standing invitation to attend, as does the Chair of the Trust. TheExecutive Lead is the Director of Finance and Estates, and support to the Committee isprovided by the Finance Department. The Committee met five times in the year, and wasquorate on each occasion.

Key Deliverables

During the year, the Committee met bi-monthly to review, in detail, internal control andgovernance, providing assurance to the Board, as well as providing developmental support tothe relevant Executives. The Committee received regular progress reports and updates onwork undertaken by internal audit, external audit, the local counter-fraud service and officersof the Trust. In addition, the members of the Committee have held private meetings with theTrust’s external and internal auditors, without officers of the Trust being present.

The Committee has also:

- reviewed and considered the draft and final annual plans of the Trust’s external andinternal auditors, as well as highlights from their key reports;

- reviewed and considered the accounting policies, and both draft and final versions ofthe Trust’s annual report and accounts, including the remuneration report, and thereport to those charged with governance by the external auditors;

- where required, and in advance of full Board review, considered the Trusts riskregister and Board assurance framework; and

- reviewed and approved, quarterly, losses incurred and compensation paymentsmade by the Trust as well as any single tenders and where the tenderingprocess has been waived.

Review of Effectiveness

The Committee has in the year reviewed its performance against its terms of reference, aspart of a review of the ongoing adequacy of the terms of reference. The Committee

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concluded:

Areas of Strength Attendance and focus at meetings is good, with robust chairing, and a positive dialogue

between Non-Executives and Executive attendees. The standing invitation to the Chair ofthe Trust and her frequent attendance provides an opportunity for additional assurance tothe Board, as well as exploratory discussions around more complex issues;

Assurance is enhanced through the attendance of internal and external audit, as wellas the local counter fraud specialists, at each meeting to report directly to theCommittee;

The additional membership of the Chair of the Quality Committee has meant a greaterfocus on clinical aspects of governance, and a widened remit for internal audit.

Areas for Improvement The administration of the Committee has improved, but needs further work –

with the support of the Company Secretary; Scrutiny of internal audit performance, and Trust officers response to internal audit

reports could be improved, to ensure greater timeliness of response and closure ofaudit reports – this has now been actioned and the Committee will continue to ensuretimely delivery of reports;

The Board has assumed a direct role in review of the Board Assurance Framework,and the Strategic Risk Register. The Committee could assume a greater role inproviding assurance and more detailed review around risk and risk management withinthe organisation.

In 2013, the Committee undertook a formal self-assessment against the nationalstandards for Audit Committees, issued by the Department of Health and HFMA. Thishas not been undertaken in the 2014/15 year, but will be undertaken in the financial year2015/16.

The Committee has also reviewed its terms of reference, with the support of the CompanySecretary, and no further amendments are required.

Conclusion

The Committee has provided assurance to the Trust Board across a number of key areas inthe last year of its operation and continues to operate effectively.

The Committee has reviewed its own performance, and effectiveness, and has identified anumber of areas of strength and a number of areas for improvement. These will be reflectedin the operation of the Committee in 2015/16.

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BOARD MEETING 25 JUNE 2015


Title: Self-evaluation of the Remuneration Committee – and Annual Report to theBoard from the Committee Chair

Purpose: Assurance: X Decision: X Discussion:

Summary:

The Remuneration Committee met five times since September 2013. The present committeestructure was put in place with effect from 1 January 2013, with new terms of reference andmembership

At its meeting on 25 April 2013, the Board noted with approval, that the annual boardevaluation exercises would comprise reviews of (i) the whole board; (ii) individual directors;and (iii) main board committees

In respect of committees, it was agreed that (i) committees would undertake assessmentsagainst objectives; and (ii) review their terms of reference, at their meetings in or close toSeptember 2014. The first remuneration committee meeting since this date took place inMarch 2015.

The following paper included the Remuneration Committee’s self-evaluation carried out on 14March 2015, and the Committee Chair’s annual report covering the preceding year and a half.

Recommendation:

That the Board notes the Committee’s self-evaluation with assurance and approval Agrees the Committee’s terms of reference remain as currently approved noting that the

Committee has delegated authority to make decisions as indicated in the ToR. Notes the Committee Chair’s annual report



Any impact: None

Prepared by:Sue Sjuve, Chair, Remuneration Committee

Presented by:Sue Sjuve, Chair, Remuneration Committee

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Committee: REMUNERATION COMMITTEE

Report of the Committee to the Board1.1 Membership and attendance: Meetings since 1 August 20121

Feb2014

Apr2014

Jun2014

Jul2014

Mar2015

% attendance

Susan Sjuve (Chair) 100%

Stephen Lightfoot 40%Sue Johnson; David Parfitt 60%

Maggie Ioannou 20%

Martin Sambrook 100%David Standfast*; Elizabeth Woodman 20%*DS rang in for the meeting on 25/2/14 but was notable to connectDP succeeded SJ in July 2014.EJ succeeded DS in March 2015

Membership consists of the Trust Chair (to be Chair of theCommittee)and all NEDs

In addition to the committee membership, the Director of HR& OD was requested to attend the meetings held on 25/2/14,9/4/14, 5/3/15; and the Chief Executive was requested toattend the meeting held on 25/2/14, 9/4/14, 18/6/14.

1.2 Conclusion: Meetings of the Committee are held ad hoc and it was onlynecessary to convene the committee five times. The meetingswere adequately attended by NEDs

2.1 Objectives (“Purposes”): Achievement of objectives To adetermine, with delegated authority

form the Board, appropriate remunerationand terms of service for the ChiefExecutive, Executive Directors and othersenior staff as agreed by the Committeefrom time to time including:

I. All aspects of salary (including anyperformance relatedelements/bonuses);

II. Provisions for other benefits, e.g. carsand including pensions;

III. Arrangements for termination ofemployment.

The Committee meets only as and when there is business tobe transacted

A meeting was held on 25/2/14, at which the committeeconsidered and approved the remuneration of the ChiefNurse, and the new Executive contract. Proposals forapprenticeship were referred to the executive team.

A meeting was held on 9 April 2014, to consider the ClinicalExcellence Awards outcomes.

A meeting was held on 18/6/14, at which the Committeeapproved the performance appraisal of the Chief Executive,as requested by the NTDA.

The meeting held on 24/7/14 considered the salaries anddiffering bases for these contracts, e.g. agenda for changeand VSM; of the Executive leadership team andrecommended no changes at that time. It also approved theincrease in the medical director’s working days per week from3 to 4.

The meeting held on 5/3/15 considered and approved aproposal to settle a long standing claim by an employee ofthe trust. This review of the committee’s performance wassubsequently circulated and approved by email in March2015.

In approving such proposals the Committeeshall ensure that staff are fairly rewardedfor their individual contribution to the

In considering the remuneration package to be offered to thenew Chief Nurse, and subsequently of the executive teamthe Committee discussed the level of a fair reward for their

1 = present; = absent;= previous committee member was present

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Trust, whilst having proper regard to theTrust’s circumstances, performance and theprovision of any national arrangements forsuch members of staff where appropriate.

individual contributions to the Trust, whilst having properregard to the Trust’s circumstances, performance and theprovision of the relevant national arrangements

The following matters were discussed, mindful to ensure thatstaff were fairly rewarded for their individual contribution tothe Trust, whilst having proper regard to the Trust’scircumstances, performance and the provision of nationalarrangements:

o At its meeting on 25/2/14 the committee consideredrecommendations for the remuneration of the ChiefNurse in line with TDA guidance and approved therecommended figure.

o At its meeting on 24/7/14 considered the salaries anddiffering bases for these contracts, e.g. agenda forchange and VSM; of the Executive leadership teamand recommended no changes at that time. It alsoapproved the increase in the medical director’sworking days per week from 3 to 4.

o The meeting held on 5/3/15 considered andapproved a proposal to settle a long standing claim byan employee of the trust.

o This review of the committee’s performance wassubsequently circulated and approved by email inMarch 2015.

2.2 Conclusion: The Committee achieved its objectives by convening meetingsto deal with matters referred to above.

3.0 Terms of Reference The committee has reviewed its terms of reference andrecommends that these remain as currently approved

3.1 Conclusion The Committee recommends, for approval of the Board, that itsterms of reference remain as currently approved.

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REMUNERATION COMMITTEE

TERMS OF REFERENCE

1. CONSTITUTION

1.1 The Remuneration Committee (the Committee) is constituted as a Standing Committee of theTrust Board (the Board), in accordance with the guidelines laid down in Governing the NHS: Aguide for NHS Boards, 1st June 2003. Its constitution and terms of reference shall be as setout below, subject to amendment at future Board meetings.

2. AUTHORITY

2.1 The Committee is authorised by the Board to investigate any activity within its terms ofreference. It is authorised to seek any information it requires from any member of staff, and allmembers of staff are directed to co-operate with any request made by the Committee.

2.2 The Committee is authorised by the Board to obtain external professional advice and requestthe attendance of individuals and authorities from outside the Trust with relevant experienceand expertise if it considers this necessary to fulfill its terms of reference.

3. PURPOSE

3.1 To advise the Board about appropriate remuneration and terms of service for the ChiefExecutive, Executive Directors and other senior staff as agreed by the Committee from time totime including:

i. All aspects of salary (including any performance related elements/bonuses);ii. Provisions for other benefits, e.g. cars and including pensions;iii. Arrangements for termination of employment.

3.2 In making such recommendation to the Board, the Committee shall ensure that staff are fairlyrewarded for their individual contribution to the Trust, whilst having proper regard to the trust’scircumstances, performance and the provision of any national arrangements for suchmembers of staff where appropriate.

4. DUTIES

4.1 The Committee’s duties are:

i. To recommend to the Board the remuneration package, including any performancerelated pay or other remuneration of the Chief Executive.

ii. With the Chief Executive, to recommend the remuneration packages, includingPerformance related pay of the Executive Directors in accordance with national andNHS South of England (and any successor body) arrangements.

iii. To ensure that senior staff are recruited in transparent and open manner andcandidates are considered on merit and against objective criteria.

iv. To agree criteria annually, in line with available guidance, for the level of performancerelated pay for the Chief Executive and, with the Chief Executive, for ExecutiveDirectors.

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v. To review and agree the role description, grading and remuneration package of anypost outside of Agenda for Change Pay Scheme or Medical/Dental pay prior to thevacancy being advertised.

vi. To review and agree processes and controls for any necessary termination ofemployment of the Chief Executive and Executive Directors to ensure probity, value formoney and compliance with NHS and statutory requirements and National TrustDevelopment Authority procedures.

vii.To review and authorise individual contractual severance (including redundancy)packages for any member of staff above £100,000.

viii. To review and authorize individual contractual severance packages (includingredundancy) and non-contractual severance packages for the Chief Executive andExecutive Directors.

ix. To approve all individual non-contractual severance payments prior to submission to theNational Trust Development Authority and HM Treasury.

x. To receive regularly information on the amount spent on consultants and interims, andthe number of consultants and interims who have been in place more than threemonths.

xi. To regularly receive information on interim staff and consultants (non-medical).

5. MEMBERSHIP

5.1 The Committee shall be appointed by the Board and its membership shall consist of thefollowing:

Chair of the Trust (Chair of the Committee) All Non Executive Directors

6. QUORUM AND REQUIRED ATTENDANCE BY MEMBERS

6.1 A quorum shall be the Chair plus two Non Executive members of the Committee.

6.2 Members of the Committee must attend at least three quarters of all meetings each financialyear but should aim to attend all scheduled meetings.

7. ATTENDANCE BY OTHERS

7.1 The Chief Executive and the Director of HR will be expected to attend.

7.2 The Chief Executive may invite other executives or other senior officers to provide advice tothe Committee when required. The Chief Executive and any other executive member willwithdraw from meetings when their remuneration packages are under discussion.

7.3 A secretary to the Committee will attend to take minutes of the meeting and provideappropriate support to the Chair and the members.

8. FREQUENCY OF MEETINGS

8.1 Meetings shall occur as and when necessary or at least twice a year. Meetings may need tobe held more frequently at times of organizational change.

9. ADMINISTRATIVE SUPPORT

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9.1 The Committee shall be supported by the Director of Workforce or his/her nominated memberof staff, whose duties in this respect will include:

Agreement of agenda with Chair and attendees, collation and distribution of papers at leastfive working days before each meeting.

Taking the minutes and keeping a record of matters arising and issues to be carriedforward.

Advising the Committee on relevant areas for consideration and/or decision. Providing support to the Chair and members as required.

10. ACCOUNTABILITY AND REPORTING ARRANGEMENTS

10.1 The minutes of all meetings shall be formally recorded. A summary report from the Chair ofthe Committee will be submitted, together with recommendations where appropriate, to theBoard at the next possible opportunity.

10.2 The minutes of the Committee are exempt under the Freedom of Information Act as theyinclude personal information.

11. MONITORING EFFECTIVENESS AND COMPLIANCE WITH TERMS OF REFERENCE

11.1 The Committee will carry out an annual review of its effectiveness and provide an annualreport to the Board on its work in discharging its responsibilities and complying with its termsof reference.

12. REVIEW

12.1 The Terms of Reference of the Committee will be reviewed by the Board at least annually andwill be subject to review and change when Foundation Trust status is achieved.

Approved by the Board on:Review date:

finance and investment committee meeting public session...the committee discussed the 2015/16...

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