Annual Members Meeting and Council of Governors General ... · on Wednesday 5 October 2016 ......

AGM2016 Agenda FINAL v2

Annual Members Meeting and Council of Governors General Meeting

on Wednesday 5 October 2016

11:00 – 13:00

at Saxon Hall, Aviation Way, Southend-on-Sea SS2 6UN

Light refreshments will be available from 10:30 prior to the meeting

OUR VISION

“Providing services that are in tune with you”

AGENDA

1 Welcome Lorraine Cabel

Chair

Verbal

2 Apologies for Absence Lorraine Cabel

Chair

Verbal

3 Declaration of Interests Lorraine Cabel

Chair

Verbal

4 Minutes of the Annual General/ Annual Members Meeting held on 18 September 2015

Lorraine Cabel

Chair

Attached

5 Presentation of Annual Report Sally Morris

Chief Executive

Presentation

6 Presentation of Annual Accounts Mark Madden

Executive Chief Finance Officer

Presentation

7 Auditors’ Reports Debbie Hanson

Executive Director

Ernst & Young LLP

Attached

8 Report from the Council of Governors

John Jones

Lead Governor

Presentation

9 Presentation on:

Carers Information

A Carer’s Life

Emma Willey

Service Development Manager

Ted Butt

Carer & Volunteer

Presentation

10 NEP/SEPT Merger Proposals Update

Nigel Leonard

Executive Director Corporate Governance

Presentation

11 Question Time Board of Directors Verbal

12 Close

Lorraine Cabel

Chair

SEPT: AMM and Council of Governors GM

Signed............................................................................................... Date....................................... In the Chair for the meeting Page 1 of 7

SEPT

MINUTES OF THE ANNUAL MEMBERS MEETING & GENERAL MEETING OF THE COUNCIL OF GOVERNORS

Held on Friday 18 September 2015 At Saxon Hall, Aviation Way, Southend on Sea SS2 6UN

In the Chair: Janet Wood Vice-Chair Board Directors present: Sally Morris Chief Executive Andy Brogan Executive Director Clinical Governance & Quality Steve Cotter Non-Executive Director Alison Davis Non-Executive Director Nigel Leonard Executive Director Corporate Governance Malcolm McCann Executive Director Integrated Services (Essex & Suffolk) Mark Madden Executive Chief Finance Officer Mary-Ann Munford Non-Executive Director Dr Milind Karale Executive Medical Director Richard Winter Executive Director Integrated Services (Beds & Luton) Governors present: Brian Arney Public Governor Roy Birch Public Governor David Bowater Appointed Governor Karen Forrest Staff Governor Jackie Gleeson Public Governor Shurleea Harding Public Governor Colin Harris Public Governor

Evelyn Hoggart Public Governor John Jones Public Governor Clive Lucas Public Governor Kresh Ramanah Public Governor Sue Revell Public Governor Sudi Sudarsanam Public Governor David Watts Public Governor

In attendance: Rob Murray Audit Director, Ernst & Young Cathy Lilley Business Administration Manager (minute taker) Other: Members of the Trust and members of the public

01/15 WELCOME AND INTRODUCTION

Janet Wood, as Vice-Chair of the Trust, opened the Annual Members Meeting and General Meeting of the Council of Governors, and welcomed Directors, Governors, presenters, staff, members and the public. She explained that she would be chairing the meeting as Lorraine Cabel, Chair of the Trust, was unable to attend due to a family bereavement and had therefore sent her apologies. Janet explained that the meeting provided the Board of Directors with an opportunity to report on the achievements and challenges for the year ended 31 March 2015. She reminded the meeting that the mental health services in Bedfordshire and Luton transferred from the Trust to a different provider on 1 April 2015 and thanked staff for

South Essex Partnership University NHS Foundation Trust

Signed.............................................................................................. Date....................................... In the Chair for the meeting Page 2 of 7

their exceptional work and commitment in ensuring the safe and effective transfer of services.

02/15 APOLOGIES FOR ABSENCE

Apologies for absence were received from: Bob Calver Public Governor Joy Das Appointed Governor Paul Delaney Staff Governor Eileen Greenwood Public Governor Paula Grayson Public Governor Lynda Lees Public Governor

David Parsons Public Governor Tracy Reed Staff Governor Jim Thakoordin Public Governor Clive Travis Public Governor Larry Smith Public Governor Tony Wright Public Governor

No apologies were received from: Bill Archibald Appointed GovernorMahmood Hussain Appointed Governor Barbara Rice Appointed GovernorMarimuthu Velmurugan Appointed Governor Cathy Lilley confirmed the meeting was quorate.

03/15 DECLARATIONS OF INTEREST

None.

04/15 MINUTES OF THE AGM HELD ON 17 SEPTEMBER 2014

The minutes of the AGM held on 17 September 2014 were approved as a correct record.

05/15 MATTERS ARISING

None.

06/15 PRESENTATION OF ANNUAL REPORT 2014/15

Sally Morris, Chief Executive, presented a review of the 2014/15 year for the Trust and reported that this had been another year of change, challenge, quality and innovation. Sally shared some of examples of change including service transformation such as the roll-out of the frailty programme in West Essex, back office redesign and the successful and safe transfer of Bedfordshire and Luton mental health services. She also described 2014/15 as a year of challenge which has seen the Trust taking actions to ensure safer staffing establishments were met, and the continued implementation of actions from national reports including the Freedom to Speak Up requirements. She highlighted some of the achievements that demonstrated the Trust’s commitment to providing high quality safe services and approach to innovation, including:



Positive staff survey results

SEPT named in the HSJ top 100 NHS Trusts

Achievement of 97% of 58 different national and local CQUIN (Commissioning for Quality and Innovation) schemes across Essex, Suffolk, Bedfordshire and Luton equating to £4.9m income

Various awards, e.g. AIMS accreditation across mental health and learning disability services, individual winners at the East of England Leadership Awards, achievement of Carbon Trust Standard

Development of a public quality dashboard

Achievement of all 13 Monitor key performance indicators (proxy measures of quality)

Governance rating of green. Sally provided a brief overview of the priorities for 2015/16 which included implementing the five year forward view, the disaggregation of CAMHs and Suffolk services, continued drive for the parity of mental and physical health and continued focus on working with partners. Sally highlighted the importance of recognising the contribution of staff and advised that during the summer of 2014 a staff recognition scheme was launched which has seen 35 individuals and 13 teams presented with an award at Board of Director meetings. This awards programme will culminate in an annual awards evening on 18 November 2015. In conclusion, Sally acknowledged and offered her congratulations and thanks to all Trust staff, the Board of Directors and Council of Governors whose dedication and skills guaranteed that the Trust vision was translated into reality. The Council of Governors received the annual report for 2014/15.

07/15 PRESENTATION OF ANNUAL ACCOUNTS 2014/15

Mark Madden, Executive Chief Finance Officer, presented the annual accounts for 1 April 2014 to 31 March 2015 including a summary of the Trust’s income and expenditure, divisional performance, capital expenditure and efficiency and income generation initiatives. These had been produced on the basis that the Trust was a going concern and were in accordance with the International Financial Reporting Standards, showing a true and fair view of the Trust’s financial activities. Mark reported that it had been another challenging but successful year for the Trust having achieved its targets and a surplus against the backdrop of continued economic pressures and drive for efficiencies. In particular he highlighted:

the successful disaggregation of the mental health services in Bedfordshire and Luton with many of the financial risks associated with the contract being mitigated

the continued challenge with the Cost Improvement Programme with the financial gap being carried forward to 2015/16

the Trust had invested to meet safer staffing nursing establishment requirements



the significant investment in the Trust’s IT platform which was a significant enabler for staff to undertaken their work and to improve services

investment in carbon management initiatives which will produce both carbon and financial savings

the delivery of significant savings of £14.3m in year and £13.6m on a recurrent basis

the Trust had achieved a Monitor continuity of service rating of 4 which indicated the strong financial health of the Trust.

Mark also pointed out the difficulties facing the Trust in the year ahead particularly around the uncertainty in the local health economy with the Essex Mental Health Review, Essex Success Regime and introduction of Accountable Care Organisations. The Council of Governors received the Annual Accounts for 2014/15.

08/15 AUDITORS’ REPORT

Rob Murray, Audit Director - Ernst & Young, presented the External Auditors’ report and confirmed that:

The Trust’s financial statements were a true and fair view

The audit of the annual accounts for 2014/15 did not identify any material errors, there were minimal adjustments to the draft financial statements and that the working papers were of a high standard for completion of the audit

An unqualified limited assurance report had been issued following the examination of the Trust’s Quality Report 2014/15 and the testing of three indicators for accuracy

An unqualified value for money conclusion had been issued

A group assurance certificate had been issued

An audit completion certificate had been issued. The Council of Governors received and noted the Auditor’s Report for 2014/15.

09/15 REAPPOINTMENT OF EXTERNAL AUDITORS

Janet Wood, Non-Executive Director and Chair of the Audit Committee, presented the report on the third reappointment of the External Auditors. Janet advised that the Trust’s constitution (clause 42.3) states that the external auditor shall be appointed for a period of not more than five years but may be subject to annual reappointment after the period if the Council so decides. She reminded the meeting that in 2012 the Council of Governors awarded Ernst & Young a 12 month contract for the provision of an external financial audit service which was renewable annually. Janet reported that the Audit Committee has the responsibility for overseeing the work of the auditors and for the annual evaluation processes. She confirmed that following review the Committee agreed that the auditors’ work remained of a sufficiently high standard and that the fees charged are reasonable.



On the recommendation of the Audit Committee, the Council of Governors unanimously agreed by a show of hands to award a contract to Ernst & Young for the provision of external financial audit service covering the financial year 2015/16. The Council of Governors approved the reappointment of Ernst & Young as the Trust’s external auditor for the financial year 2015/16 .

10/15 REPORT FROM THE COUNCIL OF GOVERNORS

John Jones, as Lead Governor, presented a report from the Council of Governors which outlined the role of the Council and highlighted its key achievements during 2014/15 including the recruitment of a new Non-Executive Director, contributing to the Quality Account and Annual Report, involvement with the significant transactions group, review of the Trust’s constituencies and Council of Governors composition, and the involvement of Governors in quality visits to Trust services. John also thanked the Board of Directors under the leadership of the Chair for being receptive to the ideas proposed by the Council to carry out its role, and also acknowledged the support of the Trust Secretary Office during the year. John concluded his presentation by stating that the Council was looking forward to continuing to support the Trust and its members, but recognised the challenges facing the Trust through the changing commissioning environment and the continued squeeze on finances, particularly those affecting mental health services. He also encouraged members and the public to attend a Council meeting or to contact their Governor representative if they have any queries.

11/15 PRESENTATION ON THE FLU CAMPAIGN

Sarah Browne presented an overview of the Trust’s staff flu vaccination campaign for 2015. She explained that it is the responsibility of the NHS and social care bodies to ensure, as far as is reasonably practicable, that health and social care workers are free of, and are protected from exposure to infections that can be caught at work. The Trust’s campaign will contribute towards patient care by minimising the risk of infection to patient and service users, and will reduce the level of sickness absence, resulting in maintaining the continuity of services. Sarah was joined by children from three local schools – Thorpedene, Bournemouth Park and St Mary’s – who shared the actions and activities being undertaken in their schools to promote the importance of the flu vaccine and general health.

12/15 LAUNCH OF THE TRUST’S STRATEGIC DIRECTION

Sally Morris presented the Trust’s strategic direction and strategic plan for 2014/17 highlighting that the Board of Directors was committed to a strategy that puts the safety and quality of services to patients first. She said that the Trust remained dedicated to delivery first class mental health and community services. The strategic direction included a focus on closer working with partner organisations and recognised the need for transformation and flexibility to meet the individual



needs and pressures in each locality. This would be set against a backdrop of significant organisation change as a result of the Essex Success Regime and Mental Health Review as well as a continued growth in demand and continued financial pressure across health and social care. The strategic direction recognised the need for flexibility and for delivering solutions for both commissioners and services users. Sally stated that it was anticipated that the local health and social care economies in Essex and Bedfordshire will look significantly different by 2017 and that the Trust was sustainable in the medium term and was well placed to meet the challenges ahead. However, it should be recognised that there would be organisational and service changes during the next three to four years.

13/15 QUESTIONS FROM MEMBERS AND THE PUBLIC

Questions were received, and answered, from a number of the Trust’s members, as well as members of the general public. These included: Question 1: Roy Birch, Public Governor, asked if the Trust would be allocated any of the £8bn additional funding which the Government announced recently. Response 1: In her opinion, Sally Morris felt that the majority of this money would be for the acute sector which was projecting a deficit of £22bn (£180m deficit projection for Essex). It is hoped that mental health services would see improvements through the Government’s commitment to parity of esteem. Question 2: John Jones, Public Governor, commented that it was pleasing to see the Trust had significant cash reserves and asked how this would benefit service users and patients. Response 2: Mark Madden explained that strong cash reserves allows the Trust to manage volatility in terms of income, providing security to maintain consistent and sustainable platform as well as investing in service provision without having to borrow and incur interest. Question 3: Concern and disappointment was expressed regarding the closure of drop-in centres. Response 3: Sally Morris explained that the decisions to close the centres were made by the CCGs against a backdrop of financial pressures and not byh the Trust. She, however, recognised the importance of these centres for service users as part of an integrated care pathway and suggested that any concerns should be raised with the local authorities and CCGs directly. Question 4: As volunteers play a big part in the Trust, are there any plans for greater service user involvement and projects? Response 4: Sally Morris acknowledged the significant contribution volunteers make in the Trust and thanked them for their continued support and commitment. She explained there are currently a number of projects involving service user and these will continue to be enhanced during the year. Question 5: It was suggested that consideration should be given to peer support and how this can be used effectively in the Trust.



Response 5: Sally Morris agreed that this was a very sensible suggestion and would refer to operational colleagues to consider how to take this forward. Question 6: A question was asked about the Trust’s view with regards to the Essex Success Regime. Response 6: Sally Morris stated that the progress with the Essex Success regime was slower than expected. She explained that regime is a whole systems intervention for Essex with the aim of providing additional support and direction to local health and care systems, and to identify and address systematic issues across the whole system, and to implement an improvement process. She had attended the launch event in July with the Chair at which basic elements of the plan had been presented and the first stage was to gather information for analysis to identify the issues; however, few details have emerged since this meeting. Question 7: How has SEPT been collaborating with other organisations and is it satisfied with its degree of collaboration? Question 7: Sally Morris referred to previous presentations and explained that the Trust recognised the importance of good working relationship and this was embedded within the Trust’s strategic direction. The Trust had been in collaboration with a number of organisations including providers and primary care, such as Southend University Hospital, North Essex Partnership University NHS FT, Princess Alexandra Hospital, Basildon & Thurrock Hospitals, as well as working with commissioners focusing on service solutions for both West and South East Essex. Question 8: Cllr David Bowater, Appointed Governor, commented that he had attended a recent meeting organised by a local GP practice where it had been raised that the GP practice employed one member of staff purely to scan patient letters which had been sent from local hospitals – however, these letters had originally be generated electronically from a computer. He asked what the Trust’s practice was with regards to electronic communications. Question 8: Jan Leonard, Director ITT, recognised the frustration with GP systems and explained that the Trust had received funds to put in place a health information exchange which would provide a portal for patient information which the GPs can access. She also pointed out that with effect from 1 October 2015, discharge summaries will need to be electronic submissions.

14/15 CLOSE

Janet Wood closed the meeting by thanking everyone who had attended and contributed to it. She stated that 2014/15 had been another challenging year but ultimately a successful one with the Trust continuing to provide high quality services to its communities. Janet thanked the Board of Directors for their ongoing leadership of the Trust, and also the Council of Governors for their continued support. She also thanked the Trust’s staff and volunteers for their hard work and dedication during the year. The meeting closed at 12:45.

Ernst & Young LLP


Letter to Governors for the year ended 31 March 2016

September 2016

Contents

EY i

Contents

Executive Summary ................................................................................................................................................................................ 2

Purpose .................................................................................................................................................................................................. 5

Responsibilities ....................................................................................................................................................................................... 7

Financial Statement Audit ..................................................................................................................................................................... 10

Value for Money .................................................................................................................................................................................... 15

Quality Report ...................................................................................................................................................................................... 18

Focused on your Future ......................................................................................................................................................................... 21

The contents of this report are subject to the terms and conditions of our appointment as set out in our engagement letter.

This report is made solely to the Board of Governors, Audit Committee, Board of Directors and management of South Essex Partnership University NHS Foundation Trust in accordance with our engagement letter. Our work has been undertaken so that we might state to the Audit Committee, Board of Directors and management of the Trust those matters we are required to state to them in this report and for no other purpose. To the fullest extent permitted by law we do not accept or assume responsibility to anyone other than the Audit Committee, Board of Directors and management of the Trust for this report or for the opinions we have formed. It should not be provided to any third party without our prior written consent.

Our Complaints Procedure – If at any time you would like to discuss with us how our service to you could be improved, or if you are dissatisfied with the service you are receiving, you may take the issue up with your usual partner or director contact. If you prefer an alternative route, please contact Steve Varley, our Managing Partner, 1 More London Place, London SE1 2AF. We undertake to look into any complaint carefully and promptly and to do all we can to explain the position to you. Should you remain dissatisfied with any aspect of our service, you may of course take matters up with our professional institute. We can provide further information on how you may contact our professional institute..

Executive Summary

Letter to Governors for the year ended 31 March 2016 – South Essex Partnership University NHS Foundation Trust

EY 2

Executive Summary

Below are the results and conclusions on the significant areas of the audit process.

Area of Work Conclusion

Opinion on the Trust’s:

► Financial statements

Unqualified – the financial statements give a true and fair view of the financial position of the Trust as at 31 March 2016 and of its expenditure and income for the year then ended.

► Parts of the remuneration and staff report to be audited

We had no matters to report.

► Consistency of the information in the performance report and accountability report with the financial statements

Financial information in the performance report and accountability report and published with the financial statements was consistent with the Annual Accounts.


Reports by exception:

► Consistency of Governance Statement

The Governance Statement was consistent with our understanding of the Trust.

► Consistency of the Annual Report within knowledge we have acquired during the course of our audit


► Referrals to NHS Improvement (formerly Monitor)


► Public interest report We had no matters to report in the public interest.

► Value for money conclusion We had no matters to report.


EY 3


Examining the contents of the Trust’s quality report and testing of three indicators

We issued an unqualified limited assurance report.

Reporting to NHS Improvement (formerly Monitor) on the Trust’s consolidation schedules

We concluded that the Trust’s consolidation schedules agreed, within a £250,000 tolerance, to your audited financial statements.

Reporting to the National Audit Office (NAO) in line with group instructions


As a result of the above we have also:


Issued a report to those charged with governance of the Trust communicating significant findings resulting from our audit.

Our Audit Results Report was issued on 24 May 2016.

Issued a report to governors on the Quality Report

Our report to Governors on the Quality Report was issued on 24 May 2016.

Issued a certificate that we have completed the audit in accordance with the requirements of the National Health Service Act 2006 and the National Audit Office’s 2015 Code of Audit Practice.

Our certificate was issued on 26 May 2016.

We would like to take this opportunity to thank the Trust staff for their assistance during the course of our work.

Debbie Hanson Executive Director For and on behalf of Ernst & Young LLP

Purpose


EY 5

Purpose

The Purpose of this Letter

The purpose of this Letter is to communicate to Governors the key issues arising from our work, which we consider should be brought to the attention of the Trust.

We have already reported the detailed findings from our audit work in our 2015/16 annual Audit Results Report to the 24 May 2016 Audit Committee, representing those charged with governance. We do not repeat those detailed findings in this letter but instead provide a summary of our key findings.

We also make reference to our limited assurance work on the Trust’s quality report.

Responsibilities


EY 7

Responsibilities

Responsibilities of the Appointed Auditor

Our 2015/16 audit work has been undertaken in accordance with the Audit Plan that we issued on 11 January 2016 and is conducted in accordance with the National Audit Office's 2015 Code of Audit Practice, International Standards on Auditing (UK and Ireland), and other guidance issued by the National Audit Office and NHS Improvement (formerly Monitor).

As auditors we are responsible for:

Expressing an opinion:

► On the 2015/16 financial statements;

► On the parts of the remuneration and staff report to be audited;

► On the consistency of the information in the performance report and accountability report with the financial statements; and

► On whether the consolidation schedules are consistent, within a £250,000 tolerance, with the Trust’s financial statements for the relevant reporting period.

Reporting by exception:

► If the annual governance statement does not comply with relevant guidance or is not consistent with our understanding of the Trust;

► On the consistency of the Annual Report within knowledge we have acquired during the course of our audit

► To NHS Improvement (formerly Monitor) if we have concerns about the legality of transactions of decisions taken by the Trust; and

► Any significant matters that are in the public interest.

► Forming a conclusion on the arrangements the Trust has in place to secure economy, efficiency and effectiveness in its use of resources.

We report to the National Audit Office (NAO) on the Trust’s Whole of Government Accounts return, the Foundation Trust Consolidation schedules, which support the Department of Health’s account consolidation.

We also undertake an independent assurance engagement on the Trust’s Quality Report for the year ended 31 March 2016 and certain performance indicators contained within the report. Our review is undertaken in accordance with the detailed guidance issued by NHS Improvement (formerly Monitor) ‘Detailed Guidance for External Assurance on Quality Reports 2015/16’.


EY 8

Responsibilities of the Trust

The Trust is responsible for preparing and publishing its statement of accounts, annual report and annual governance statement. In the annual governance statement, the Trust publicly reports on the extent to which it complies with its own code of governance, including how it has monitored and evaluated the effectiveness of its governance arrangements in the year, and on any planned changes in the coming period.

The Trust is also responsible for putting in place proper arrangements to secure economy, efficiency and effectiveness in its use of resources.

Financial Statement Audit


EY 10

Financial Statement Audit

Key Issues

The Annual Report and Accounts is an important tool for the Trust to show how it has used public money and how it can demonstrate its financial management and financial health.

Our 2015/16 audit work on the Trust’s statement of accounts has been undertaken in accordance with the Audit Plan we issued on 11 January 2016 and is conducted in accordance with the National Audit Office’s 2015 Code of Audit Practice, International Standards on Auditing (UK and Ireland), and other guidance issued by the National Audit Office and NHS Improvement (formerly Monitor).

We issued an unqualified audit report on 26 May 2016. Our detailed findings were reported to the 24 May 2016 Audit Committee, through our Audit Results Report.

The key issues identified as part of our audit were as follows:

Significant Risk Conclusion

Management override of controls

A risk present on all audits is that management is in a unique position to perpetrate fraud because of its ability to manipulate accounting records directly or indirectly, and prepare fraudulent financial statements by overriding controls that otherwise appear to be operating effectively.

Auditing standards require us to respond to this risk by testing the appropriateness of journals, testing accounting estimates for possible management bias and obtaining an understanding of the business rationale for any significant unusual transactions.

We did not identify any material weaknesses in controls or evidence of material management override.

We obtained a full list of the journals posted to the Trust’s general ledger during the year, and analysed these journals using criteria we set to identify unusual journal types or amounts. We then tested a sample of journals that met our criteria and agreed these to supporting documentation.

We considered those accounting estimates most susceptible to bias and tested those as part of our audit work.

We did not identify any transactions during our audit which appeared unusual or outside the Trust’s normal course of business.

We did not identify any instances of inappropriate judgements being applied.


EY 11

Revenue and expenditure recognition

Auditing standards also require us to presume that a risk that revenue and expenditure may be misstated due to improper recognition or manipulation.

We considered that this risk could be increased by the Trust’s financial position resulting in a risk that the financial statements could be manipulated to ensure that the budgeted position was achieved. [tailor to local circumstances]

Our testing focussed on the Trust’s main income/expenditure streams. We also carried out cut-off testing where we examined a sample of receipts and payments after year end to ensure that where the transactions related to 2015/16 that they were properly recorded in the accounts.

We also reviewed the agreement of intra-NHS balances and investigated significant differences and disputes.

Our testing did not reveal any material misstatements with respect to revenue and expenditure recognition.

Bedfordshire and Luton demerger

A major service transformation took place on the first day of the 2015/16 financial year which involved the disaggregation of the Trust’s mental health services in Bedfordshire and Luton.

These services, associated property, plant and equipment and staff transferred to a new NHS provider on 1 April 2015, resulting in material adjustments to the financial statements for 2015/16.

Given the significant values involved, there was a risk that the Trust’s financial statements may be materially misstated

Our review and testing of the accounting transactions relating to the Bedfordshire and Luton demerger did not identify any material misstatements in the financial statements.


EY 12

Other Key Findings Conclusion

Agreement of balances with commissioners

The current financial pressures within the NHS economy mean that income recognised by the Trust may be disputed by the commissioning body. Disputes may not be resolved by the deadline for completion of the accounts. There is therefore a risk that income in the financial statements may not be fully recoverable.

We gained sufficient audit assurance over the figures in the financial statements and we have no issues to report to the Governors.

Our procedures did not identify any significant potential financial penalties related to contract performance.

Financial instrument disclosures

Our audit identified a potential issue within the Financial Instruments disclosure note; which includes the Pensions - Other Staff provision of £4,015k disclosed as a financial liability. We focussed on whether there is a contractual obligation to pay the provided amounts related to pensions, or whether the obligation arises from statute and therefore may not meet the definition of a financial instrument.

Following discussion, the Trust chose not to amend the statements for this issue as they concluded that a contractual obligation does exist for this provision. They included an additional statement within their Letter of Representation to such effect.

The Trust will review its financial instrument disclosures in detail during 2016/17.

Control Themes and Observations

As part of our work, we obtained an understanding of internal control sufficient to plan our audit and determine the nature, timing and extent of testing performed. Although our audit was not designed to express an opinion on the effectiveness of internal control, we are required to communicate to you significant deficiencies in internal control identified during our audit.

Our audit did not identify any controls issues to bring to the attention of the Governors.


EY 13

Department of Health Group Instructions

We issued an unqualified confirmation to the National Audit Office (NAO), under its group instructions, regarding the Foundation Trust’s Whole of Governments Accounts return, which supports the Department of Health’s account consolidation. We did not identify any areas of concern.

We are also required by NHS Improvement (formerly Monitor) to provide to the Trust a statement that the consolidation schedules (FTCs) are consistent with the audited accounts, including a list of inconsistencies greater that £250,000 between the FTCs and the accounts. We reported that the FTCs were consistent with the audited statements.

Annual Governance Statement

We are required to consider the completeness of disclosures in the Trust’s annual governance statement, identify any inconsistencies with the other information of which we are aware from our work, and consider whether it complies with relevant guidance.

We completed this work and did not identify any areas of concern.

Referral to the Regulator

We must report to NHS Improvement (formerly Monitor) any matter where we believe a decision has led to, or would lead to, unlawful expenditure, or some action has been, or would be, unlawful and likely to cause a loss or deficiency. We had no exceptions to report.

Report in the Public Interest

We have a duty under the National Health Service Act 2006 to consider whether, in the public interest, to report on any matter that comes to our attention in the course of the audit in order for it to be considered by the Trust or brought to the attention of the public.

We did not identify any issues which required us to issue a report in the public interest.

Value for Money


EY 15

Value for Money

We are required to consider whether the Trust has put in place ‘proper arrangements’ to secure economy, efficiency and effectiveness on its use of resources. This is known as our value for money conclusion.

Proper arrangements are defined by statutory guidance issued by the National Audit Office. They comprise your arrangements to:

Take informed decisions;

Deploy resources in a sustainable manner; and Work with partners and other third parties.

Proper arrangements for securing value for money

Informed decision making

Working with partners and third parties

Sustainable resource

deployment


EY 16

We did not identify any significant matters in relation to the Trust’s arrangements to secure economy, efficiency and effectiveness on its use of resources. We therefore had no matters to report by exception regarding value for money arrangements in our audit report issued on 26 May 2016.

We completed the procedures outlined in our Audit Plan, and did not identify any significant weaknesses in the Trust’s arrangements to ensure it took properly informed decisions and deployed resources to achieve planned and sustainable outcomes for taxpayers and local people.

Quality Report


EY 18

Quality Report

Responsibilities

We are required to perform an independent assurance engagement in respect of South Essex Partnership University NHS Foundation Trust Quality Report for the year ended 31 March 2016 (the ‘Quality Report’) and certain performance indicators contained within the report. Our review is undertaken in accordance with NHS Improvement (formerly Monitor)’s ‘Detailed Guidance for External Assurance on Quality Reports 2015/16’.

As auditors we are required to:

► review the content of the Quality Report against the requirements set out in the NHS Foundation Trust Annual Reporting Manual 2015/16, which is combined with the quality accounts requirements in NHS Improvement (formerly Monitor)’s document ‘Detailed Requirements for Quality Reports 2015/16’;

► review the content of the Quality Report for consistency against the other information published by the Trust;

► undertake substantive sample testing on two mandated performance indicators and one locally selected indicator;

► provide the Trust with a limited assurance report confirming that the Quality Report meets NHS Improvement (formerly Monitor)’s requirements and that the two mandated indicators are reasonably stated in all material respects;

► provide the Trust’s Governors with a report setting out the findings of our work including the content of the Quality Report, mandated indicators and the locally selected indicator.

Compliance and consistency

We reviewed the Trust’s Quality Report and found that its content was in line with NHS Improvement (formerly Monitor)’s requirements, and it was consistent with other information published by the Trust.


EY 19

Performance indicators

We undertook testing on two mandated indicators:

► Patients on care programme (CPA) followed up within seven days of discharge from psychiatric inpatient stay

► Delayed transfers of care (DTOCs)

In both instances we found no evidence to suggest that the two mandated indicators have not been reasonably stated in all material respects.

The local indicator tested was:

► Adults and elderly mental health patients re-admitted within 28 days of discharge

We found no evidence to suggest that the local indicator has not been reasonably stated in all material respects.

Focused on your Future


EY 21

Focused on your future

Area Issue Impact

NHS provider financial pressures

Draft 2015/16 financial statements showed NHS providers overspent by a record £2.45 billion for the year. The scale of this overspending is unprecedented. Despite additional funding and significant efforts to reduce deficits, record numbers of trusts overspent and the overall deficit is likely to be three times higher than in 2014/15. Some 48 trusts reported a deficit of more than £20 million, including 11 trusts reporting an individual deficit of more than £50 million.

At the same time, performance against key targets is continuing to deteriorate and there are increasing concerns over the quality of services. Providers as a whole missed the Accident and Emergency waiting target of seeing 95 percent of patients within four hours for the final quarter of the year, and waiting lists for routine operations reached 3.34 million.

It is not yet clear whether trusts’ financial performance for the year will cause the Department of Health to exceed its spending limit for 2015/16, a serious breach of parliamentary protocol. Whether or not there is a breach, NHS trusts will start 2016/17 with a collective deficit of around £1 billion more than planned. Without change there is the potential for the increasing financial pressure to impact further on levels of patient care.

The scale of the financial challenges faced by NHS providers impacts all aspects of their operations. It is therefore a key driver of audit risk and impacts our approach.

Sustainability and Transformation Plans

NHS England’s document, Delivering the Forward View: NHS planning guidance 2016/17-2020/21, published in December 2015, asks local health systems, including local government, voluntary and community partners, to work together to secure transformation change in healthcare planning and delivery.

For this purpose England has been divided into 44 local health systems, made up of local councils, CCGs and NHS and other providers. Each health system had to produce, by the end of June 2016, a Sustainability and Transformation Plan covering the next five years.

Bodies will need to work together to a far greater extent than ever before to ensure that sustainability and financial plans are viable, and successfully delivered. Failure to do this could have wider adverse financial and service delivery consequences across the whole local area.

As your external auditor we need to gain an understanding of your wider approach and plans, and the impact of greater partnership working on your governance, internal control and financial reporting.


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Area Issue Impact

The initial requirement is for CCGs and providers to control expenditure and stay within budget in 2016-17. Subsequently, spending and performance will need to be managed sustainably over the following four years in order to access the available transformation funding. This is intended to fund changes to service delivery while maintaining and improving patient safety and quality over the years 2017-21. Failure to deliver on targets agreed will results in bodies being unable to access transformation funding, which will from now on be the only additional funds available.

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Annual Members Meeting and Council of Governors General ... · on Wednesday 5 October 2016 ......

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