Skip to main content

Full text of "Integration Joint Board - 29/08/2019"

See other formats



Integration Joint Board 
29^'^ August 2019 
Agenda Item No. 

Subject: 

Deloitte LLP: 2018/19 Annual Audit Report 

Purpose: 

The Board is required to approve the audited annual accounts for 
2018/19 for issue by 30 September 2019 and to consider the 
report from External Audit. 

Recommendation: 

That the Board: 

(a) Note that Deloitte LLP have completed their audit of the 
annual accounts for 2018-19 and have Issued an 
unqualified independent report auditor’s report; 

(b) Approve the Audited Annual Accounts to be signed for 
issue. 


Glossary of Terms 

NHS AA 

NHS Ayrshire and Arran 

HSCP 

Health and Social Care Partnership 

MTFP 

Medium Term Financial Plan 


1. 

EXECUTIVE SUMMARY 

1.1 

The Integration Joint Board (IJB) were required to produce a set of annual accounts 
for 2018-19. These accounts were produced within the statutory timescale and have 
been subject to independent audit by the Integration Joint Board’s external auditors, 
Deloitte LLP. The audit process has been completed and external audit have issued 
an unqualified independent auditors report. 

1.2 

The annual accounts were submitted to Deloitte LLP for audit in accordance with the 
agreed timetable. The external auditor is required to report on certain matters arising 
to those charged with governance in sufficient time to enable appropriate action to 
be taken before the financial statements are approved and certified. 

1.3 

The Audited Annual Accounts require to be approved by the IJB prior to 30 

September 2019. As part of the independent audit there were some minor changes 
required, these were mainly presentational and to provide additional information or 
clarification and there are no changes to the financial position reported to the 
Performance and Audit Committee in June. Deloitte LLP’s External Audit Annual 

Audit Report includes the findings of the audit and there are no recommendations for 
improvement arising from the financial statements audit. The interim report 
submitted to the Performance and Audit Committee in June 2019 detailed the 
recommendations arising from the work on the wider audit dimensions. These will be 
followed up as part of the 2019-20 audit. 

















2 . 


BACKGROUND 


2.1 The Integration Joint Board is subject to the audit and accounts provisions of a body 
under section 106 of the Local Authority Government (Scotland) Act 1973. This 
requires annual accounts to be prepared with the reporting requirements specified in 
the reievant iegislation and reguiations. The requirements are proportionate to the 
number of transactions of the Integration Joint Board whilst complying with the 
requirement for transparency and true and fair reporting in the pubiic sector. 

2.2 The audited annuai accounts have been prepared in accordance with the Code of 
Practice on Accounting for Locai Authorities in the United Kingdom 2018-19. 
Additionai guidance was issued by the Scottish Government Integrated Resources 
Advisory Group (IRAG) and CIPFA LASAAC and this guidance has been foiiowed to 
produce the unaudited accounts. In addition support was provided by CIPFA and 
Audit Scotiand to ensure a consistency of approach and shared best practice across 
Integration Joint Boards. 

2.3 The Audited Annuai Accounts for 2018-19 are inciuded as Appendix 1, these 
incorporate the independent auditors report. Deioitte LLP are able to conclude that 
the Integration Joint Board’s accounts present a true and fair view of the IJB. 

2.4 Appendix 2 inciudes a covering ietter from Deioitte LLP which incorporates their 
ISA260 ietter “report to those charged with governance” together with their proposed 
Independent Auditor's Report and the letter of representation to be signed by the 
Chief Finance Officer (NAHSCP) as responsibie officer for North Ayrshire Flealth and 
Social Care Partnership. Deioitte LLP's External Audit Annuai Audit Report to 
members, which summarises the findings of the audit is attached at Appendix 3. 

2.5 Deioitte LLP have given an unquaiified opinion that the 2018-19 financiai statements 
give a true and fair view of the financial position and expenditure and income of the 
IJB for the year, concluding that the accounts have been properly prepared in 
accordance with relevant legislation, applicable accounting standards and other 
reporting requirements. No monetary adjustments have been identified and the 
overall financial position remains as reported to the Performance and Audit 
Committee in June 2019. 

2.6 As part of their audit work, alongside the audit of the annual accounts, Deioitte LLP 
assessed the key financial and strategic risks being faced by the IJB, reviewing the 
IJB’s financial position and aspects of financial management, sustainability, 
transparency, governance and vaiue for money. 

Representatives from Deioitte LLP wiii provide an overview and further feedback on 
the report at the meeting. 

2.7 The Integration Joint Board are required to formaiiy approve the Audited Annuai 
Accounts prior to 30 September 2019, the IJB are asked to approve the accounts for 
signature and issue. Thereafter they wiii be published on the partnership website. 




3. 

PROPOSALS 

3.1 

The Board is invited to note that Deloitte LLP have completed their audit of the 
annual accounts for 2018-19 and have issued an unqualified independent auditor’s 
report. The IJB is also asked to approve the Audited Annual Accounts to be signed 
for issue. 

3.2 

Anticipated Outcomes 


The annual accounts are a key statutory reporting requirement and can be a useful 
way to join up financial and service delivery performance information in a readily 
available public document, the IJB has a statutory responsibility to approve the 
Audited Accounts for issue by 30 September 2019. 

3.3 

Measurina Impact 


Progress against the wider scope recommendations will be reviewed by the 
Performance and Audit Committee during 2019/20. 


4. IMPLICATIONS 


Financial : 

The IJB are required to consider and approved the 
Audited Annual Accounts for 2018-19 by 30 
September 2019. 

Human Resources : 

None 

Legal: 

None 

Equality: 

None 

Environmental & Sustainability: 

None 

Key Priorities : 

None 

Risk Implications : 

None 


Direction Required to 

Direction to :- 


Councii, Heaith Board or 

1. No Direction Required 

X 

Both 

2. North Ayrshire Council 


(where Directions are required 

3. NHS Ayrshire & Arran 


piease compiete Directions 
Tempiate) 

4. North Ayrshire Council and NHS Ayrshire & Arran 



5. 

CONSULTATION 

5.1 

The unaudited annual accounts were advertised and made publicly available for 
inspection; the audited accounts will require to be published by 30 September 2019. 
There were no objections noted from the public inspection. 

The Chief Officer and other officers of the IJB have been consulted during the audit 
process. 






























6. CONCLUSION 

6.1 Deloitte LLP have issued an unqualified opinion on the 2018-19 annual accounts. 


For more information piease contact: 

Caroiine Whyte, Chief Finance & Transformation Officer on 01294 324954 or 
caroiinewhvte@north-avrshire.qcsx.qov.uk 




ANNUALACCOUNTS 

FOR THE YEAR ENDED 31 MARCH 2019 



Integration Joint Boar 


Delivering care 
together 








Contents 


Management Commentary.1 

Statement of Responsibilities.1 

Annual Governance Statement.1 

Remuneration Report.1 

Financial Statements.1 


- Comprehensive Income and Expenditure Statement 

- Movement in Reserves Statement 

- Balance Sheet 

Notes to the Financial Statements.1 

- Note 1: Significant Accounting Policies 

- Note 2: Critical Judgements and Estimation Uncertainty 

- Note 3: Events After the Reporting Period 

- Note 4: Expenditure and Income Analysis by Nature 

- Note 5: Taxation and Non-Specific Grant Income 

- Note 6: Debtors 

- Note 7: Creditors 

- Note 8: Usable Reserve: General Fund 

- Note 9: Agency Income and Expenditure 

- Note 10: Related Party Transactions 

- Note 11: VAT 

- Note 12: Accounting Standards Issued Not Yet Adopted 

Independent auditor’s report.35 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


1 











Management commentary 


This publication contains the Annual Accounts of North Ayrshire Integration Joint Board (IJB) for the 
year ended 31 March 2019. 

The Management Commentary outlines the key messages in relation to the IJB’s financial planning 
and performance for the year 2018-19 and how this has supported delivery of the IJB’s strategic 
priorities. This commentary also looks forward, outlining the future financial plans for the IJB and the 
challenges and risks that we will face as we strive to meet the needs of the people of North Ayrshire. 


North Ayrshire IJB 

Each of the three Ayrshire health and social 
care partnerships established their Integration 
Joint Boards on 1 April 2015. The IJB’s 
purpose is to improve the health and wellbeing 
of local people, create support within our 
communities and deliver joined-up care 
pathways for people who use health and social 
care services, particularly those who have 
complex care needs. 

North Ayrshire Health and Social Care 
Partnership (NAHSCP/the Partnership) is the 
name given to the service delivery 
organisation for functions which have been 
delegated to the IJB. 

NAHSCP is facing significant challenges. 

In 2018, NAHSCP launched a refreshed 
strategic plan, Let’s Deliver Care Together, 
outlining our ambitions for 2018-2021. The 
plan sets the key strategic priorities that will 
ensure that we deliver our vision. It seeks to 
address the increasing health Inequalities in 
North Ayrshire and focuses on improving the 
efficiency and quality of the services being 
provided, putting individuals, families and 
communities at the heart of the plan. 

North Ayrshire Health and Social Care 
Partnership’s vision is: 

‘All people who live in North Ayrshire are 
able to have a safe, healthy and active iife’ 


This vision is supported by five strategic 
priorities: 

Tackling 

inequalities 


Engaging 

communities 


Prevention Bringing 

and early services 

intervention together 

NAHSCP priorities 

North Ayrshire Council and NHS Ayrshire & 
Arran delegate responsibility for the planning 
of services to the IJB. The IJB commissions 
services from North Ayrshire Council and NHS 
Ayrshire & Arran and is responsible for the 
operational oversight of integrated services. 
NAHSCPs Chief Officer is responsible for the 
operational management of integrated 
services. 

The Chief Officer is supported by heads of 
service for each service area and the 
partnership management team. A dedicated 
Chief Finance and Transformation Officer role 
was Introduced during 2017-18, with the 
position subsequently filled on a permanent 
basis in July 2018. 


Improving 
mental health 
and wellbeing 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


2 






Health & Community 
Care 


n Head of Service 


Children, Families & 
Justice 


ih Head of Service d 


■ Mental Health & ' 
Learning Disability 



I Chief Finance and i 
Transformation 
Officer 


NAHSCP structure 


The IJB Strategic Plan is supported by day to 
day management plans and individual service 
strategies. These plans operationalise and 
provide greater detail on how the IJB will 
deliver on its key priorities and identifies the 
resources required for implementation. 
Further, implementation of the strategic plan is 
key for the Partnership to achieve the nine 
National Health and Wellbeing Outcomes set 
by the Scottish Government. 

The Strategic Plan also complements North 
Ayrshire Community Planning Partnership’s 
Local Outcome Improvement Plan (LOIP), the 
North Ayrshire Council plan and the NHS 
Ayrshire & Arran Annual Operating Plan. This 
is vital to ensure that our limited resources are 
targeted in a way that makes a significant 
contribution to our shared priorities. 


North Ayrshire today 

North Ayrshire is home to 136,000 
people and covers an area of 340 
square miles and includes the 
islands of Arran, Great Cumbrae 
and Little Cumbrae. 

During 2017, it was estimated that 
10,800 (24.4%) households in 
North Ayrshire were workless. 
Between October 2017- 
September 2018, unemployment 
was 5.8%, (Scottish average, 
4.2%). The claimant count in 
North Ayrshire (February 2019) 
was 5.6%, again above the 
Scotland average of 3% 

We know that the population of 
North Ayrshire is expected to fall 
over the next 10 years, and we 
expect that there will be fewer 
people aged 65 and under, 
reducing the number of working 
age adults. We also expect that 
the number of people aged 65+ 
will increase by 20%, with the 
highest increase (38%) in those 
aged 75 or over. 



According to Scottish Index of Multiple Deprivation 
(SIMD) 2016, 39% of North Ayrshire residents live 
in areas identified as amongst the most deprived 
in Scotland. 


39% equates to almost 53,000 people 




Levels of multi morbidity 

(people with more than one chronic 
medical condition) are higher in the 
most deprived areas 


North Coast locality has lower levels of deprivation 
compared with other areas in North Ayrshire and 
as such, have lower levels of people with multi¬ 
morbidities (11% for those 65 and older) compared 
with areas with higher levels of deprivation, such 
as Three Towns locality, where multi-morbidity 
levels are much higher (36% for those 65 or older). 



In 2018, Child Poverty Action Group published their 
report on levels of child poverty across the UK. In 
this report, it was estimated that 7,878 children in 
North Ayrshire were living in poverty, this 
equates to 29%> of all local children. While this is 
slightly less than the 30.4% reported in 2016, North 
Ayrshire still has the second highest rate of child 
poverty in Scotland, after Glasgow City. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


3 


































A snapshot of achievements during 2018-19 







do 








% 


We had 1,612 Conversations 

in North Ayrshire on 6 June 2018 #WMTY18 


Teams noted how many conversations they had, the benefits and challenges of taking part, 
decided on one change that they would make as a team and agreed on a suggested 
change for the overall service 



what 
matters 
to you? 


i. 

i. 



Our Community Link Worker team 
increased from 7 to 12 by September 2018. 
All 20 General Practices in North Ayrshire 
now have a Community Link Worker in post. 


The Ayrshire 

MENTAL 

HEALTH 

Conversation 


2018 


People could respond as a service user, 
someone who hadn’t accessed services 
or as a carer or family member of 
someone who has used services. 
People had the opportunity to have their 
say via local conversation events, paper- 
based questionnaires (in local libraries 
and within other local services) and an 
online survey. 

The Ayrshire Mental Health 
Conversation received 777 responses, 
creating a way forward for mental health 
services across Ayrshire. 


North Ayrshire Achieves winners included 
Montrose House management team 

(Promoting Wellbeing category) Care at 
Home for Building Community Capacity 
category. 



across Ayrshire 




Intermediate Care and Community 
Rehabilitation Service went live on 19 
November 2018. The service has a 
common framework, ensuring a consistent 
approach across Ayrshire. This is applied 
locally to reflect the 
differing needs, 
ambitions and 
operational 
arrangements of the 
different partnerships 
in East, North and 
South Ayrshire. 

In consultation with people who use our 
learning disability services, we are re¬ 
developing the property, gardens and 
grounds at Trindlemoss (previously Red 
Cross House, Irvine) to provide person- 
centred, wraparound care focussing on 
each person’s outcomes and people in the 
heart of their community. 

Our partners in the independent care 
home sector continued to provide care 
home services during a period of instability 
in the sector. 

Partnership Care at Home Services 

graded as 5 by the Care Inspectorate. 

The Veterans 1®' Point (VIP) Service 

celebrated its 1®* birthday 

Carers Week was celebrated with events 
taking place in all six localities. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


4 











Organisational performance 

The planning and delivery of transformational 
change within the Health and Social Care 
Partnership requires our services to make a 
difference to people’s lives within North 
Ayrshire. To support service change the 
Partnership continually monitors service 
performance, and reviews this in various ways. 

Performance information drives improvement 
with an outcomes focus on improving how 
services are provided, as well as the difference 
that integrated health and social care services 
should make to individuals. In our 
performance monitoring and reporting, we 
show trends over time, where we are against 
target and where available, how we compare 
with other geographical areas. We monitor 
against all the agreed national indicators, 
including Local Government Benchmarking 
Framework (LGBF) indicators. Ministerial 
Steering Group Indictors (MSG), the NHS’ 
Local Delivery Plan HEAT (Health 
Improvement, Efficiency, Access and 
Treatment) targets, HSCP National Health and 
Wellbeing Outcome Indicators, as well as a 
range of locally defined measures. 

All reports comprise of a series of key 
performance indicators and key actions, which 
link directly back to our strategic plan. 
Performance is reported at a number of levels 
within the organisation including the 
Integration Joint Board Performance and Audit 
Committee (IJB PAG), the Integration Joint 
Board (IJB), the Joint Review with North 
Ayrshire Council and NHS Ayrshire & Arran 
Chief Executives, and all service performance 
reviews within each service area. 

Where an indicator is off track, commentary 
with proposed resolution and future mitigation 
is provided on how to improve performance. 

The number of performance indicators was 
reviewed during 2018-19 and reduced from 45 
to 24 key measures. The latest Performance 
and Audit Committee Report (Q4 2018-19) 
shows progress against the key measures and 


this is represented in the chart below. 


Progress of 24 performance indicators 


Significantly 
adrift, 8, 

33% 1^ 


Slightly 
adrift, 1, 4% 



Data only, 
1, 4% 


On target, 
14, 59% 


■ On target ■ Slightly adrift ■ Significantly adrift ■ Data only 


For some measures performance is exceeding 
the targeted levels, however it is clear that the 
challenges remain for others. These include 
challenges around workforce gaps, service 
demand pressures and the pace of 
transformational change not happening fast 
enough to ensure performance is achieved or 
improved in all areas. 

As part of our commitment to continuous 
improvement, we recognise areas where we 
could do more and by monitoring indicators 
which present as significantly adrift enables us 
identify and target plans to address 
performance issues. 

The key areas off target for 2018-19 are: 

• Number of days people spend in hospital 
when they are ready to be discharged 

• Care at Home capacity lost due to 
cancelled hospital discharges 

• Number of people delayed, at point of 
discharge from hospital to a care home, 
after funding has been confirmed 

• Number of adults in receipt of a Direct 
Payment 

• Number of Child and Adolescent Mental 
Health Services (CAMHS) referrals 

• Referral to Treatment Times for 
Psychological Therapies 

• Working days lost to sickness absence 
per employee 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


5 





















The hospital activity outcome indicators have 
shown improvement towards the end of the 
year. The partnership now have a hospital 
based team in Crosshouse Hospital with daily 
huddles to improve the flow of patients through 
the hospital and assist with the discharge 
process. Further work is required to 
understand the underlying data and 
interdependencies with community services to 
inform the future commissioning plans which 
require to be developed to ensure the set aside 
arrangements are fit for purpose and support 
the IJB to plan across the whole of the 
unplanned care pathway. 

Further Information on performance is 
contained in the Annual Performance Report 
published in July 2019. 

http://www.nahscp.orq/performance/ 


Annual accounts 

The Annual Accounts set out the financial 
statements of the IJB for the year ended 31 
March 2019. The main purpose is to 
demonstrate the stewardship of the public 
funds that have been entrusted to the IJB for 
the delivery of its vision and strategic priorities 
as outlined in the Strategic Plan. The 
requirements governing the format and 
content of the Annual Accounts are contained 
in The Code of Practice on Local Authority 
Accounting in the United Kingdom (the Code), 
the Annual Accounts for 2018-19 have been 
prepared in accordance with this Code. 

The financial plan 

strong financial planning and management is 
paramount to ensure our limited resources are 
targeted to maximise the contribution to our 
objectives. Delivery of services in the same 
way is not financially sustainable. The updated 
strategic plan approved for 2018-21 is 
underpinned by the need to transform care 
models to find new solutions as the partnership 
may not always be the first source of support. 


In 2018-19 the partnership agreed a one year 
budget but did not identify all savings required 
to fully balance the budget. With an overall 
savings requirement of £6.6m, £1.7m of which 
being historic NHS CRES savings which 
remained outstanding at the year-end. The 
financial position was monitored closely during 
the financial year with a financial recovery plan 
approved to ensure the partnership could 
achieve financial balance in the short term. 
This allowed for time to plan properly as part of 
the 2019-20 budget process to develop plans 
to fully address the budget gap on a recurring 
basis. 

The ability to plan based on the totality of 
resources across the health and care system 
to meet the needs of local people is one of the 
hallmarks of integrated care. Medium term 
financial planning is key to supporting this 
process and identifying the transformation and 
planned shift in resources to provide 
sustainable services to the local community 
over the medium term. 

The Medium Term Financial Plan (MTFP) is 
being refreshed and will be key to supporting 
the delivery of the strategic plan. This plan will 
set out the expectation to start to deliver a shift 
in care from a hospital setting to a community 
setting within the resources available. 

Financial performance 

Financial Information is part of the 
performance management framework with 
regular reporting of financial performance to 
the IJB. This included an integrated approach 
to financial monitoring, reporting on progress 
with savings delivery, financial risks and any 
variations and changes to the delegated 
budget. There were significant financial 
challenges during the year due to increasing 
demand for social care services, the delivery of 
the transformation programme and associated 
savings. Despite this there was an improved 
financial position compared to 2017-18. 

Throughout the year there was a projected 
overspend position, as a consequence a 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


6 




financial recovery plan was put in place to 
support the delivery of services from within the 
delegated budget. The financial recovery plan 
and progress was monitored throughout the 
financial year. 

The overall financial performance against 
budget for the financial year 2018-19 was an 
overall underspend of £0.945m (£0.389m in 
social care services and £0.556m in heaith 
services). This position includes the £1.486m 
budget being heid on behaif of the IJB by the 
Council for debt repayment, as this was 
required to be transferred back to the IJB at the 
financial year-end. This position is aiso before 
earmarking £0.277m of resource for use in 
future years. 


65,543 

64,714 

(829) 

Health and Community Care 

65,900 

65,952 

52 

71,761 

72,772 

1,011 

Mental Health 

73,308 

72,982 

(326) 

33,504 

35,965 

2,461 

Children, Families and Justice 

35,591 

35,705 

114 

49,637 

49,518 

(119) 

Primary Care 

48,916 

48,839 

(77) 

0 

0 

0 

Allied Health Professionals 

4,636 

4,588 

(48) 

4,266 

5,798 

1,532 

Management and Support Costs 

6,821 

5,970 

(851) 

2,870 

2,347 

(523) 

Change Programme 

2,623 

2,290 

(333) 

227,581 

231,114 

3,533 

TOTAL EXPENDITURE 

237,795 

236,326 

(1,469) 

(227,581) 

(228,552) 

(971) 

TOTAL INCOME 

(237,795) 

(237,795) 

0 

0 

2,562 

2,562 

OUTTURN ON A MANAGED BASIS 

0 

(1,469) 

(1,469) 

0 

0 

0 

Lead Partnership Allocations 

0 

524 

524 

0 

2,562 

2,562 

OUTTURN ON AN IJB BASIS 

0 

(945) 

(945) 

0 

0 

0 

Earmarking 

0 

277 

277 

0 

2,562 

2,562 

FINAL OUTTURN POSITION 

0 

(668) 

(668) 


2018-19 2018-19 Variance 
Budget Actual (Fav) / Adv 


2017-18 2017-18 Variancel 

Budget Actual (Fav) / A^ 

£000 £000 £ 000 | 


The final adjusted year-end position was a 
£0.668m underspend after earmarking, this 
baiance wiil be used to commence repayment 
of the historic debt carried forward from 
previous years. 

The IJB plans during 2018-19 were that prior 
to the £1.486m set aside for debt repayment 
being reallocated to the partnership that the 
IJB would work towards delivering financiai 
baiance in-year which would have allowed the 
full amount set-aside to be aiiocated towards 
the debt at the year-end. The fuii repayment 
was not possible due to demand and costs for 
social care services. 


The table above summarises the financiai performance for 2018-19 and 2017-18. This notes the 
budget outturn on a managed basis (including the full allocation for North HSCP lead partnership 
services), adjusts this for the net impact of lead partnership allocations across North, South and 
East Ayrshire and also for new earmarked balances. As the table reflects the budget managed by 
the IJB during the year, it exciudes the iarge hospital Set Aside Budget of £30.114m which was 
allocated at the end of the year to the IJB. The set aside budget is inciuded within the financiai 
statements. During 2018/19 the Aiiied Heaith Professional budget transferred into the partnership 
from the South HSCP foilowing a decision to end the iead partnership arrangement and 
disaggregate the budget to East and North HSCP. 

The main areas of variance during 2018-19 are noted beiow: 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


7 




























Health and Community Care - overspend of £0.052m mainly relates to an overspend in care 
home placements and community packages (PD) partially offset by underspends in care at home, 
adaptations and district nursing. 

Mental Health - underspend of£0.326m which relates to an overspend in learning disability care 
packages which is offset by underspends in community mental health and the Lead Partnership for 
mental health (psychology, child and adolescent mental health services (CAMHS)) and unplanned 
activities (UnPACs). 

Children, Families and Justice - overspend of £0.114m is mainly related to an overspend in 
residential and secure placements partially offset by an underspend within fostering. 

In general, the areas above are overspent within the social care aspect of service provision which 
is demand led and subject to fluctuations throughout the year. These are at times difficult to deliver 
within budget as some can be low volume but very high cost. 

Management and Support Costs - underspend of £0.851 m mainly relates to the allocation of the 
£1.5m for the debt repayment offset by unachieved NHS GRES savings (cash releasing efficiency 
saving). 

Change Programme - underspend of £0.333m mainly relates to slippage on various projects 
either through vacancies or alternative funding identified for the continuation of projects. 

Challenge Fund 

North Ayrshire Council, during the 2017-18 budget setting process, approved the development of 
an innovative approach for the establishment of a £4m ‘Challenge Fund’. This ‘invest to change’ 
programme created an opportunity for services, using a change approach, to realise both required 
North Ayrshire Council savings and additional savings which could be re-invested in their newly 
designed service to support future sustainability. These projects included placing a team within a 
secondary school to support the school and a feeder primary to prevent children being placed in a 
residential placement resulting in no placements from these schools, employing additional 
reablement staff within care at home resulting in a lower level of support moving forward, and 
establishing a Learning Disability Review team to review existing care package provision. 

The projects which commenced in 2017-18 have completed during 2018-19 and following 
evaluation either ceased or continued to be funded on a recurring basis by the savings made from 
the projects. Due to financial pressures in the partnership and North Ayrshire Council the £4m 
originally available for investment was reduced to £2m and with projects nearing completion there 
is now no separate funding out-with the baseline IJB budget to fund investment in transformational 
change programmes. 

Lead Partnership Services 

The final outturn is adjusted to reflect the impact of Lead Partnership services. During 2018-19 
agreement was reached with the other Ayrshire partnerships that in the absence of detailed service 
activity information and alternative risk sharing arrangements that the outturn for all Lead 
Partnership services would be shared across the 3 partnerships on an NRAC (NHS Resource 
Allocation Committee) basis. 

The outturn (including the impact of the AHP service being disaggregated) of the lead partnership 
services for each IJB is provided below, the adjustment to the North IJB outturn reflects the impact 
of reallocating a share of the North lead partnership services underspend to the other two areas and 
an NRAC share of the outturn for the South and East partnerships. In addition, any allocations of 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


8 



ring-fenced funding are returned to each IJB in line with allocations and expenditure to allow each 
IJB to carry forward for future use. 


IJB 



North 

(889) 

Underspend 

South 

(72) 

Underspend 

East 

270 

Overspend 


Set Aside Budget 

The Integration Scheme establishes that pressures in respect of large hospital set aside budgets 
will be managed In-year by NHS Ayrshire & Arran. The 2018-19 budget delegated by NHS Ayrshire 
& Arran includes the acute set aside resource of £30.114m, this is based on Information Services 
Division Scotland (ISD) data. The set aside allocation below highlights that North Ayrshire’s use of 
the resource is above the NRAC ‘fair share’: 


IJB 

Set Aside 
2018-19 

£m 

NRAC 

% 

NRAC Budget 
Share 

2018-19 

£m 

Over / (Under) 
NRAC Fair 
Share 

£m 

East Ayrshire 

23.430 

32.1% 

25.019 

(1.589) 

North Ayrshire 

30.114 

37.2% 

28.994 

1.120 

South Ayrshire 

24.396 

30.7% 

23.927 

0.469 

Totai 

77.940 

100% 

77.940 

- 


There is an expectation that each partnership will move towards it’s NRAC ‘fair share’ of resources. 

It is essential that the IJB operates within the delegated budget and commissions services from the 
Council and Health Board on that basis. Financial balance has not been delivered in previous years, 
significant progress has been made during 2018-19 to ensure the ongoing financial sustainability of 
the IJB. This work will continue and be built upon moving Into 2019-20. Key successes for 2018- 
19 Include: 

• Repayment of the outstanding debt to the Council has commenced, although less than the 
£1.5m planned there remains a substantial contribution of £0.668m to the outstanding debt 

• On an HSCP managed basis the partnership delivered a £1.5m underspend, this reflects the 
impact of financial management arrangements and controls across all service directly 
managed by the partnership 

• 2018-19 is the first year where the year-end IJB position has been accounted for in a truly 
integrated way with resource shifting from the NHS budget to offset Social Care pressures 

• Overall reported surplus allows for the earmarking and protection or ring fenced funding for 
Scottish Government priorities 

• Savings totalling £4m were delivered in-year, against an approved plan of £4.9m and 
delivering more than expected at the start of the year against savings viewed as high risk for 
delivery 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


9 




















Progress with reducing the financial overspends for 2018-19 which will have an impact on 
the financial plans and sustainability for future years. 


Strong financial leadership wili continue to be required to ensure that future spend is contained 
within the budget resources available, the IJB move into the 2019-20 with an approved baianced 
budget. 


Financial outlook, risks and plans for the future 

The Heaith and Sociai Care Deiivery Pian 
(pubiished December 2016) outiined the need to 
shift the balance of where care and support is 
deiivered, to outwith a hospitai setting when that 
is the best thing to do. This provides a ciear 
impetus to the wider goal of 50% of the health 
budget being spent in the community by 2021. 

During 2018-19 the Pan Ayrshire Intermediate 
Care and Rehab Modei was impiemented which 
is predicated on a shift from acute to community 
care. 

In October 2018, the Scottish Government 
pubiished the Medium Term Health and Social 
Care Financial Framework which sets out the 
future shape of Health and Social Care Demand 
and Expenditure. Within the report it outlined that the Institute of Fiscai Studies and Heaith 
Foundation reported that UK spending on heaithcare wouid require to increase in reai terms by an 
average of 3.3% per year over the next 15 years to maintain NHS provision at current levels, and 
that social care funding wouid require to increase by 3.9% per year to meet the needs of a popuiation 
iiving linger and an increasing number of younger adults living with disabilities. The report 
recognised that despite additionai pianned investment in heaith and sociai care the system still 
needs to adapt and change. 

The focus of the financial framework is on the main heaith and social care expenditure commitments, 
as set out beiow. 

• Over the course of this pariiament, baseiine aiiocations to frontline health boards will be 
maintained in reai terms, with additional funding over and above infiation being allocated to 
support the shift in the baiance of care. 

• Over the next five years, hospital expenditure wiii account for iess than 50% of frontline NHS 
expenditure. This relates to the policy commitment to ‘shift the baiance of care’, with a greater 
proportion of care provided in a setting close to a person’s home rather than in a hospitai. 

• Funding for primary care will increase to 11 % of the frontline NHS budget by 2021-22. This wiii 
amount to increased spending of £500 million, and about haif of this growth wiii be invested 
directly into GP services. The remainder wiii be invested in primary care services provided in 
the community. 

• The share of the frontiine NHS budget dedicated to mental health, and to primary, community, 
and social care will increase in every year of the parliament. For adults, and in some cases for 



North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


10 




children, these services, along with unscheduled hospital care, are now managed by Integration 
Authorities. 

The Ministerial Strategic Group (MSG) for Health and Community Care published a report following 
the Review of Progress with Integration of Health and Social Care (February 2019). Within the 
integrated finance and financial planning area the proposals include: 

• Health Boards, Local Authorities and IJBs should have a joint understanding of their respective 
financial positions as they relate to integration 

• Delegated budgets for IJBs must be agreed timeously 

• Delegated hospital budgets and set aside requirements must be fully implemented 

• Each IJB must develop a transparent and prudent reserves policy 

• Statutory partners must ensure appropriate support is provided to IJB Section 95 officers 

• IJBs must be empowered to use the totality of resources at their disposal to better meet the 
needs of their local populations. 

The Partnership has a responsibility, with our local hospital services at University Hospital 
Crosshouse and University Hospital Ayr, for planning services that are mostly used in an 
unscheduled way. The aim is to ensure that we work across the health and care system to deliver 
the best, most effective care and support. Service areas most commonly associated with unplanned 
use are included in the ‘Set Aside’ budget. Set Aside budgets relate to the strategic planning role 
of the Partnership. Key areas within this budget are: 

• Accident and emergency 

• Inpatient services for general medicine 

• Geriatric medicine 

• Rehabilitation 

• Respiratory 

• Learning disability, psychiatry and palliative care services provided in hospital 

Acute Services within NHS Ayrshire & Arran continue to face particular budget pressures around 
the costs of covering a high level of medical vacancies and the increasing needs of patients 
requiring nursing support above funded levels. There have been a high number of unfunded beds 
in use to meet demands and this pressure has been managed in-year by NHS Ayrshire & Arran in 
line with the Integration Scheme. The ability to plan with the overall resource for defined populations 
and user groups and to use budgets flexibly is one of the hallmarks of integrated care. A national 
Finance Development Group has been established to support implementation of the financial 
aspects of health and social care integration legislation and associated guidance. It is recognised 
that there is a need to understand the progress that is being made towards planning across the full 
pathway of care, including the acute hospital component and the way in which the statutory 
guidance on the use of delegated hospital budgets is being applied in practice. 

Set Aside resources, as well as Lead Partnership / hosted services were recognised as areas 
requiring further development as part of the review of the Integration Scheme carried out in 2017 
and in the Strategic Planning, Commissioning and Delivery of Health and Social Care Services 
within NHS Ayrshire & Arran report to the IJB on 13 June 2018. This report sets out arrangements 
for the next steps in respect of ‘fair share’ commissioning within the NHS Ayrshire & Arran health 
and social care system. The report also outlines future developments in respect of Directions as 
per the model provided by the Public Works (Joint Working) Scotland Act 2014 for IJBs to 
commission services from Councils and NHS Boards. Pan-Ayrshire workshops have been held 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


11 





with representatives from the Scottish Government to take forward a national pilot project on ‘fair 
share’ commissioning through the use of Directions. This national pilot will ensure that delegated 
hospital budgets and Set Aside budget requirements will be fully implemented. The Ministerial 
Strategic Group for Health and Community Care Review of Progress with Integration of Health and 
Social Care report published February 2019 set this out as a key proposal under integrated 
finances and financial planning requirements 

In March 2017, the IJB approved the first Medium Term Financial Plan covering the period 2017- 
2020. This is being refreshed and will be presented to the IJB during 2019 and will cover the period 
2020-23. The Partnership will continue to face high levels of demand for services, however, it is 
fundamental that services are commissioned within the resources made available building on the 
good progress during 2018-19, this will be a high priority during 2019-20. 

Availability of funding for public services correlates with economic growth, which continues to be 
weak with continuing uncertainty on the impact of Brexit. The partnership is supporting the 
continuing work within the Council and NHS Ayrshire & Arran to minimise the impact of Brexit. An 
area of risk to the partnership is the consequence of the funding pass through from the Council 
and NHS and the availability of workforce. These risks are included in the Council and NHS 
planning for Brexit as they are the employing bodies and funded by the Scottish Government. The 
implementation of new policy initiatives and the lifting of the public sector pay cap also Impact on 
the funding available for core services and the flexibility to use resource in line with local 
requirements. 

The most significant risks faced by the IJB over the medium to longer term, alongside mitigation, 
are summarised below. 


Impact of budgetary 
pressures 


‘Mitigation 

•Medium Term Financial Plan 
•Strategic Plan 
•Change Programme 
•Active Demand Management 


Delivery of the Change 
Programme 


‘Mitigation 

•Transformation Board 

•Programme Leads 

•Strategic Planning Officers 
Group (SPOG) 

•Change Team Project 
Management Support 


L. _ _ _ _ _ — j 


Culture and 
practice 


‘Mitigation 

•Thinking Different, Doing 
Better HSCP experience 

•Multi Disciplinary Team 
Approach 

•Strategic Workforce Plan 


These risks emphasise the importance of effective planning and management of resources. It Is 
therefore crucial that we focus on early Intervention, prevention and recovery if we are to work 
within the total delegated partnership budget. 

To achieve its vision, the Partnership recognises it cannot work in isolation. The Partnership will 
continue to strengthen relationships with colleagues within the Community Planning Partnership to 
ensure a joint approach to improving the lives of local people. 

Most Importantly, the Partnership must work closer with local people and maximise the use of 
existing assets within communities to improve the overall health and wellbeing of people in North 
Ayrshire. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


12 










The planned Thinking Different, Doing Better sessions will focus on thinking differently about how 
we support people more appropriately, moving away from a deficit-based approach to assessment 
and care provision. By supporting people to think about resources and support they have available 
and allowing statutory services to prioritise resources to support people who need it the most, 
ensuring our resources are used equitably across the population of North Ayrshire. 

2019-20 Budget 

When setting the 2019-20 budget the intention was to bring a refreshed 3 year Medium Term 
Financial Plan to the IJB for approval, this was not possible due to the protracted negotiations over 
funding for 2019-20. The MTFP will be refreshed and brought to the IJB for approval later in 2019. 

The Scottish Government finance settlement set out a number of conditions and requirements for 
Health Boards and Councils in relation to funding delegated to Integration Authorities. The 
delegated funding from both North Ayrshire Council and NHS Ayrshire & Arran meets those 
Scottish Government requirements. The requirements include: 

• NHS payments to Integration Authorities for delegated health functions must deliver a real 
terms uplift in baseline funding 

• £120 million will be transferred from the Health Portfolio to the Local Authorities in-year for 
investment in integration, including delivery of the Living Wage and uprating free personal 
care, and school counselling services 

• £40 million has been included directly In the Local Government settlement to support the 
continued implementation of the Carers (Scotland) Act 2016 and extending free personal 
care to under 65s 

• Additional funding is to be an increase to 2018-19 recurrent spending and not substitutional, 
and permitting further flexibility for Local Authorities to offset adult social care allocations by 
up to £50m or 2.2% of adult social care allocations based on local need 

• Mental Health Funding must be at least 1.8% higher than the recurring 2018-19, to be over 
and above the new investment in Mental Health services to be distributed In-year 

• The set aside arrangements support the Health and Social Care Medium Term Financial 
Framework - reducing hospital utilisation variation 

Moving into 2019-20, the Partnership is proactively working to provide safe and effective services 
for the residents of North Ayrshire within the financial envelope. The IJB approved a one year 
balanced budget for 2019-20 in March 2019, at that time there was a requirement to identify and 
approve additional savings of £6.1 m, as noted in the budget gap summary below: 


r 

1 

Sociai Care 
(NAC) 
£m 

Heaith 
(NHS A&A) 
£m 

Totai 

£m 

Funding Increase 

1.389 

2.319 

3.708 

Funded Pressures 

(5.093) 

(2.561) 

(7.654) 

Budget Gap 

(3.704) 

(0.242) 

(3.946) 

Add historic CRES 

- 

(2.188) 

(2.188) 

TOTAL Savings Required 

(3.704) 

(2.430) 

(6.134) 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


13 















The Integration Joint Board in common with most Public Sector bodies is facing a period of 
significant financial challenge, with cost and demand pressures expected to outstrip any funding 
uplifts. 

There are a number of highlighted financial risk areas that may impact on the 2019-20 budget 
during the year, these include: 

• High risk areas of low volume / high cost services areas e.g. Learning Disability care 
packages, children’s residential placements, complex care packages 

• Progress with the work to develop set aside arrangements and the risk sharing 
arrangements agreed as part of this 

• Mitigating the costs and impact of specific unfunded pressures where there is uncertainty 
over the value of the impact 

• Implementation costs of the Scottish Government policy directives, for example Free 
Personal Care for under 65’s 

• Potential re-grading of posts due to erosion of grade differentials 

• Lead / hosted service arrangements, including managing pressures and reporting this 
across the 3 IJBs 

• The impact on Lead partnership and acute services from decisions taken by other Ayrshire 
areas. 

These risks will be monitoring during 2019-20 and financial impact reported through the financial 
monitoring report. 

The Transformation Board meets monthly to oversee the change programme, the group is 
solutions focussed with a view to identifying and implementing actions to get any off track plans 
back on target. The planned 2019-20 transformation and savings plans have been reviewed and 
the change team resource has been aligned to the delivery of these plans and these will be 
monitored through the Transformation Board. 

Moving forward the plan for 2019-20 is to ensure the following actions are implemented: 

• Continuation of the Transformation Board to review and challenge progress with the 
transformation programme 

• All savings to be delivered per the agreed timetable to realise appropriate savings for 
2019-20 and beyond - delivery of Transformation Programme 

• Refresh of the Medium Term Financial Plan (MTFP) 

• Work on directions, set aside, formalise commissioning arrangements etc 


Conclusion 

The fourth year as an integrated Health and Social Care Partnership has seen significant progress 
towards achieving financial balance and overall service sustainability. The IJB has a deficit of 
£5.139m (2017-18 reduced to £5.807m) as it moves into 2019-20. There is a repayment plan to 
allow the deficit to be recovered over the medium term to support the financial sustainability of the 
Partnership. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


14 



The IJB recognises it must deliver services within its financial envelope for 2019-20 and our 
transformation programme will continue with delivery of the savings plan and service redesign. 

There is a focus on the integration of services to deliver real change to the way services are being 
delivered, with a realism that continuing to deliver services in the same way is no longer sustainable 
and changes need to be made in the way services are accessed and provided. The scale and 
pace of change requires to be accelerated, the financial challenges drive the pace of change, 
however the requirement to change and re-design services to improve outcomes for individuals 
would exist despite the financial pressures. 

There is an expectation that within North Ayrshire the pattern of spend will change and there will 
be a shift in the balance of care from institutional to community settings. The integration of health 
and social care provides a unique opportunity to change the way services are delivered, it is an 
opportunity to put people at the heart of the process, focussing on the outcomes they want by 
operating as a single health and social care service. 

The IJB through the Strategic Plan outlines the belief that together we can transform health and 
social care services to achieve the joint vision for the future “all people who live in North Ayrshire 
are able to have a safe, healthy and active life”. Moving into 2019-20, we are working proactively 
to address the financial challenges, while at the same time, providing high-quality and sustainable 
health and social care services for the communities in North Ayrshire. 


Where to find more information 

If you would like more information on IJB strategies, plans and policies and our performance and 
spending, please refer to the Partnership’s website www.nahscp.orq 



Stephen Brown 
Chief Officer 

29 August 2019 



Cllr Robert Foster 
IJB Chair 

29 August 2019 



Caroline Whyte 
Chief Finance Officer 

29 August 2019 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


15 








Statement of responsibilities 


Responsibilities of the IJB 

The IJB is required to: 

• Make arrangements for the proper administration of its financial affairs and to secure that 
the proper officer of the board has responsibility for the administration of those affairs 
(section 95 of the Local Government (Scotland) Act 1973). In this authority, that officer is 
the chief finance officer 

• Manage its affairs to secure economic, efficient and effective use of resources and 
safeguard its assets 

• Ensure the annual financial statements are prepared in accordance with legislation (The 
Local Authority Accounts (Scotland) Regulations 2014), and so far as is compatible with that 
legislation, in accordance with proper accounting practices (section 12 of the Local 
Government in Scotland act 2003) 

• Approve the Annual Accounts for signature 


I confirm that the audited annual financial statements were approved for signature at a meeting of 
the IJB on 29 August 2019. 



Robert Foster 
IJB Chair 
29 August 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


16 




Responsibilities of the Chief Finance Officer 

The Chief Finance Officer is responsible for the preparation of the IJB’s Annual Accounts in 
accordance with proper practices as required by legislation and as set out in the CIPFA/LASAAC 
Code of Practice on Local Authority Accounting in the United Kingdom (the Accounting Code). 

In preparing the annual accounts, the Chief Finance Officer has: 

• Selected suitable accounting policies and then applied them consistently 

• Made judgements and estimates that were reasonable and prudent 

• Complied with legislation 

• Complied with the local authority Code (in so far as it is compatible with legislation) 
The Chief Finance Officer is also required to: 

• Keep proper accounting records which are up to date 

• Take reasonable steps to ensure the propriety and regularity of the finances of the 
Integration Joint Board 


I certify that the financial statements give a true and fair view of the financial position of the North 
Ayrshire Integration Joint Board as at 31 March 2019, and its income and expenditure for the year 
then ended. 



Caroline Whyte 
Chief Finance Officer 

29 August 2019 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


17 






Annual governance statement 


The Annual Governance Statement explains how North 
Ayrshire IJB compiies with the Code of Corporate Governance 
and meets the requirements of the CIPFA / SOLACE 
Framework ‘Delivering Good Governance in Local Government 
2016’ and the ‘Code of Practice for Local Authority Accounting 
in the UK: A Statement of Recommended Practice’, in relation 
to the Statement on the System of Internai Financiai Controi. 



Scope of responsibility 

North Ayrshire IJB is responsibie for ensuring 
that its business is conducted in accordance 
with the iaw and proper standards, and that 
public money is safeguarded and properiy 
accounted for and used economicaiiy, 
efficiently and effectively. 

The IJB is also responsible for putting in place 
proper arrangements for the governance of its 
affairs and facilitating the effective exercise of 
its functions, which includes arrangements for 
the management of risk. 


Purpose of the governance 
framework 

The governance framework comprises the 
systems and processes, and culture and 
values by which the IJB is directed and 
controlled and the activities through which it 
accounts to and engages with the community. 
It enables the IJB to monitor the achievement 
of its strategic priorities and to consider 
whether those priorities have led to the 
delivery of appropriate, cost-effective services. 


In discharging this responsibiiity, the Chief 
Officer has put in piace arrangements for 
governance which includes the system of 
internal control. Reliance is piaced on these 
controls which are designed to manage risk to 
a reasonable level but cannot eliminate the 
risk of faiiure to achieve policies, aims and 
objectives. It can therefore only provide 
reasonabie but not absoiute assurance of 
effectiveness. 


The system of internai control is a significant 
part of that framework and is designed to 
manage risk to a reasonabie ievel. The system 
of internal control is based on an ongoing 
process designed to identify and prioritise the 
risks to the achievement of North Ayrshire 
IJB’s poiicies, aims and objectives, to evaiuate 
the iikeiihood of those risks being reaiised and 
the impact should they be realised, and to 
manage them efficiently, effectively and 
economically. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


18 




Governance framework 

The main features of the governance 
framework that was in place during 2018-19 
are summarised below: 

• The IJB, comprising all IJB Board 
members, was the key decision-making 
body. The Performance and Audit 
Committee considered all matters in 
relation to Internal and External Audit, 
Risk Management and Performance 

• Strategic decision-making is governed by 
the IJB’s key constitutional documents 
including the Integration Scheme, 
standing orders, scheme of 
administration, scheme of delegation to 
officers and financial regulations 

• The Integration Scheme sets out the 
process to determine financial 
contributions by partners to Integration 
Joint Boards. This has been 
supplemented by directives from the 
Scottish Government in relation to 
additional resources for Health and Social 
Care Integration 

• The IJB’s purpose and vision are outlined 
in the IJB Strategic Plan which links 
closely to the vision of the North Ayrshire 
Community Planning Partnership and the 
Local Outcome Improvement Plan (LOIP) 
and is underpinned by an annual action 
plan and performance indicators. Work 
was carried out to refresh the Strategic 
Plan and this was approved by the IJB in 
April 2018. Regular progress reports on 
the delivery of the Strategic Plan were 
provided to the Performance and Audit 
Committee and the IJB 

• The Performance Management Strategy 
focuses very firmly on embedding a 
performance management culture 
throughout the IJB. Regular reporting to 
Board Members takes place 

• A risk management strategy and strategic 
risk register is in place for the IJB. 


• A Health and Care Governance Framework 
was agreed by the IJB on 9 March 2017. 
This covers governance arrangements in 
relation to complaints and customer 
feedback, risk management, health and 
safety, Internal Audit, workforce planning 
and public protection. Regular updates are 
provided to the IJB by the Health and Care 
Governance Group. 

• The IJB has adopted a ‘Code of Conduct’ 
for all of its Board Members and employees, 
a register of interests is in place for all Board 
members and senior officers 

• The IJB has in place a development 
programme for all Board Members, the 
Partnership Senior Management Team and 
senior managers across the Partnership. 
Performance and Personal Development 
(PPD) schemes are in place for all staff, the 
aim of which is to focus all staff on their 
performance and development that 
contributes towards achieving service 
objectives 

• The IJB has established six locality 
planning forums, reflecting the previously 
agreed local planning areas. These provide 
Board Members, health and social care 
staff and local community representatives 
with the opportunity to be involved in 
considering and influencing priorities for 
each area 

• A Transformation programme is in place, 
covering four main themes of building 
teams around children, developing a wider 
range of primary care services, supporting 
older people and people with complex care 
needs and creating mental health and 
learning disability services to better support 
people to stay well. A Transformation Board 
has oversight of the programme. 

The governance framework was in place 

during the year ended 31 March 2019. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


19 



System of internal financial 
control 

The governance framework described 
operates on the foundation of internal controls. 
The system of internal financial control is 
based on a framework of regular management 
information, financial regulations, 
administrative procedures (including 
segregation of duties), management 
supervision, and a system of delegation and 
accountability. Development and maintenance 
of these systems is supported by NHS 
Ayrshire & Arran and North Ayrshire Council in 
relation to the operational delivery of health 
and social care services. In particular, these 
systems include: 

• Financial regulations and codes of 
financial practice 

• Comprehensive budgeting systems 

• Regular reviews of periodic and annual 
financial reports that indicate financial 
performance against the forecasts 

• Setting targets to measure financial and 
other performance 

• Formal project management disciplines 

• The establishment of a Transformation 
Board to provide further scrutiny of 
service re-design and financial delivery 

• An effective Internal Audit function 

The IJB’s financial management 
arrangements conform to the governance 
requirements of the CIPFA statement: ‘The 
Role of the Chief Finance Officer in Local 
Government (2014)’. 

Membership of IJB 

The following new appointments were made: 

• Chair, Kilwinning Locality Forum 

• Vice Chair, Performance and Audit 
Committee 

• Section 95 Officer 


Review of effectiveness 

North Ayrshire IJB has responsibility for 
conducting, at least annually, a review of the 
effectiveness of its governance framework 
including the system of internal control. The 
review of the effectiveness of the framework is 
informed by the work of the Partnership Senior 
Management Team who have responsibility 
for development and maintenance of the 
governance environment, the annual report by 
the Chief Internal Auditor and reports from 
Audit Scotland and other review agencies. 

The Chief Internal Auditor reports directly to 
the IJB Performance and Audit Committee on 
all audit matters, with the right of access to the 
Chief Officer, Chief Finance Officer and Chair 
of the Performance and Audit Committee on 
any matter. In accordance with the principles 
of the code of corporate governance, regular 
reports were made to the IJB’s Performance 
and Audit Committee during 2018-19. 

The internal audit function has independent 
responsibility for examining, evaluating and 
reporting on the adequacy of internal control. 
During 2018-19, the partnership operated in 
accordance with relevant professional audit 
standards and the Public Sector Internal Audit 
Standards. 

The Chief Internal Auditor is responsible for 
forming an annual opinion on the adequacy 
and effectiveness of the systems of internal 
control. 

It is the opinion of the Chief Internal Auditor 
that the systems of internal control relied upon 
by the IJB continue to provide reasonable 
assurance against loss. 

New reporting responsibilities were placed 
on IJBs by the Public Bodies (Joint Working) 
(Scotland) Act 2014, during 2018: 

• Model Publication Scheme 

Freedom of Information (Scotland) Act 
2002 (FOISA) requires Scottish public 
authorities to produce and maintain a 
publication scheme. The Scottish 
Information Commissioner wrote to all 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


20 



IJBs (Nov 2018) asking for key changes to 
be included in their updated schemes. 
This was updated in 2018. 

• Records Management Plan 

Public Records (Scotland) Act 2011 
requires named authorities to prepare a 
Records Management Plan (RMP). North 
Ayrshire IJB is a named authority under 
the Act. The Records Management Plan 
for North Ayrshire IJB was agreed by the 
IJB in February 2019. 

Annual Performance Report 

The IJB endorsed the Annual Performance 
Report at the meeting in November 2018. This 
report, highlighted IJB’s operations in 2017- 
18, outlined the good performance of the 
Health and Social Care Partnership and how it 
delivered against the strategic priorities and 
the national outcomes. The 2018-19 report 
was published in July 2019. 

Carer’s (Scotland) Act 2016 

Integration Schemes were amended in 2018 
to reflect requirements of Carers (Scotland) 
Act 2016. The revised Integration Schemes for 
East Ayrshire, North Ayrshire and South 
Ayrshire IJBs were submitted to Scottish 
Government in March 2018 and approved by 
the Cabinet Secretary on 3 April. 

Terms of Reference 

Terms of Reference were reviewed and 
amended for the undernoted governance 
groups of the IJB during 2018-19: 

• Locality Partnership Forums 

• Strategic Planning Group 

• Performance and Audit Committee 

Transformation Board 

Last year’s Governance Statement stated that 
the Change Programme Board should 
establish more robust arrangements to secure 


change and transformation at scale and pace. 
A review in 2018 led to the creation of a 
Transformation Board with a smaller, more 
strategic membership, a focussed Terms of 
Reference and streamlined governance 
arrangements. The first meeting was held in 
August 2018. 

Review of Progress with Integration of 
Heaith and Social Care 

The Ministerial Strategic Group’s (MSG) final 
report relating to the review of progress with 
integration of health and social care was 
submitted to IJB on 14 February 2019. North 
Ayrshire HSCP will benchmark and evaluate 
their position against the 25 proposals outlined 
in the report and the Audit Scotland report, and 
produce an action plan to be presented to the 
IJB during 2019. To ensure compatibility with 
other self-evaluations, the Scottish 
Government issued a template for completion, 
following IJB approval this has been submitted 
to the Scottish Government and progress with 
the identified actions will be reported through 
the Performance and Audit Committee and 
IJB. 

Chief Finance and Transformation Officer 

During 2017-18, a new full-time post of 
Chief Finance and Transformation Officer was 
created to assist with the monitoring of 
financial performance and to drive 
transformational change in support of the 
future financial challenge. This post was 
recruited to on a permanent basis in 
2018-19. 


The elements noted above incorporate 
progress with the further actions or 
developments identified in the 2017-18 Annual 
Accounts, all of those actions were delivered 
as planned during 2018-19. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


21 



Further actions 


The IJB has identified the following actions for 2019-20 that will assist with the further strengthening 
of corporate governance arrangements: 

• Implement the actions identified through the self-evaluation in relation to the review of 
progress with integration 

• Develop a framework through which the IJB can demonstrate compliance with its statutory 
duty to secure Best Value 

• Support the Pan-Ayrshire work on developing Directions for Lead Partnership services 

• Develop commissioning plans and Directions in relation to the acute set-aside resources 

• Develop Risk Management arrangements, including an agreed risk appetite statement 

• Put in place a plan to review, on a rolling basis, IJB key governance documents, including for 
example Standing Orders, Scheme of Delegation and Financial Regulations. 

• Further develop the capacity and support Locality Planning Forums to establish and 
implement locality plans 


Assurance 

Subject to the above, and on the basis of the assurances provided, we consider the governance 
and internal control environment operating during 2018-19 to provide reasonable and objective 
assurance that any significant risks impacting on the achievement of our actions will be identified 
and actions taken to avoid or mitigate their impact. 

Systems are in place to continually review and improve the governance and internal control 
environment and action plans are in place to address identified areas for improvement. 

The Annual Governance Statement explains how North Ayrshire IJB complies with the Code of 
Corporate Governance and meets the requirements of the CIPFA / SOLACE Framework ‘Delivering 
Good Governance in Local Government 2016’ and the ‘Code of Practice for Local Authority 
Accounting in the UK: A Statement of Recommended Practice’, in relation to the Statement on the 
System of Internal Financial Control. 



Stephen Brown 
Chief Officer 

29 August 2019 


Cllr Robert Foster 
IJB Chair 

29 August 2019 



North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


22 



Remuneration report 


This remuneration report is provided in accordance with the 
Local Authority Accounts (Scotland) Regulations 2014. It 
discloses information relating to the remuneration and 
pension benefits of specified IJB members and staff. 

The information in the tables below is subject to external 
audit. The explanatory text in the Remuneration Report is 
reviewed by the external auditor to ensure it is consistent 
with the financial statements. 

Remuneration: IJB Chair and Vice Chair 

The IJB comprises eight voting members appointed through nomination in equal numbers by NHS 
Ayrshire & Arran and North Ayrshire Council. A Chair and Vice Chair are appointed in accordance 
with the Integration Scheme and the Public Bodies (Joint Working) (Integration Joint Boards) 
(Scotland) Order 2014. As required in Article 4 of the Order the nomination of the IJB Chair and 
Vice Chair post holders alternates between a Council and Health Board representative, with the 
Vice Chair appointment by the constituent authority who did not appoint the Chair. 

The IJB does not provide any additional remuneration to the Chair, Vice Chair or any other board 
members relating to their role on the IJB. The IJB does not reimburse the relevant partner 
organisations for any voting board member costs borne by the partner. There were no taxable 
expenses paid by the IJB. Therefore no remuneration disclosures are provided for the Chair or Vice 
Chair. 

The IJB does not have responsibilities, either in the current year or in future years, for funding any 
pension entitlements of voting IJB members. Therefore no pension rights disclosures are provided 
for the Chair or Vice Chair. 

Remuneration: Senior Officers of the IJB 

The IJB does not directly employ any staff in its own right, however specific post-holding officers are 
non-voting members of the Integration Joint Board. 

Chief Officer 

The appointment of an Integration Joint Board Chief Officer is required by section 10 of the Public 
Bodies (Joint Working) (Scotland) Act 2014 which includes the statement “an Integration Joint Board 
is to appoint, as a member of staff, a chief officer”. The Chief Officer for the IJB has to be appointed 
and the employing partner has to formally second the officer to the IJB. The employment contract 
for the Chief Officer adheres to the legislative and regulatory framework of the employing partner 
organisation. The remuneration terms of the Chief Officer’s employment are approved by the IJB. 

Other Officers 

No other staff are appointed by the IJB under a similar legal regime. Other non-voting board 
members who meet the criteria for disclosure are included in the disclosures below. 



North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


23 





Total 

remuneration 

2017-18 

Name and post title 

Salary, fees 
and 

allowances 

Taxable 

expenses 

Total 

remuneration 

2018-19 

£ 


£ 

£ 

£ 

106,906 

Stephen Brown, 

Chief Officer 

108,506 

0 

108,506 

0 

Caroline Whyte, 

59,336 

0 

59,336 


Chief Finance Officer 




3,479* 

Margaret Hogg, 

Chief Finance Officer 

0 

0 

0 


* This relates solely to the post of Chief Finance Officer. Margaret Hogg was remunerated separately by North 
Ayrshire Council for the post of Head of Finance. 


In respect of officers’ pension benefits the statutory liability for any future contributions to be made 
rests with the reievant empioying partner organisation. On this basis there is no pensions liability 
reflected on the IJB balance sheet for the Chief Officer or any other officers. 

The IJB however has responsibility for funding the employer contributions for the current year in 
respect of the officer time spent on fuifiiling the responsibilities of their roie on the IJB. The following 
tabie shows the IJB’s funding during the year to support officers’ pension benefits. The tabie aiso 
shows the total value of accrued pension benefits which may include benefits earned in other 
empioyment positions and from each officer’s own contributions. 


r 

In Year pension 
contributions 


Accrued 

pension benefits 

“ 1 


Year to 
31/3/18 
£ 

Year to 
31/3/19 
£ 


Difference 

from 

31/3/18 

as at 
31/3/19 

Stephen Brown, 

0 

0 

Pension 

0 

0 

Chief Officer from April 2017 to March 



Lump Sum 

0 

0 

2019 






Caroline Whyte, Chief Finance Officer 

0 

11,412 

Pension 

n/a 

1,207 

from July 2018 to March 2019 



Lump Sum 

n/a 

0 

Margaret Hogg, Chief Finance Officer 

0 

0 

Pension 

n/a 

n/a 

from April 2016 to December 2017 



Lump Sum 

n/a 

n/a 


Disclosure by pay bands 

As required by the reguiations, the foiiowing tabie shows the number of persons whose 
remuneration for the year was £50,000 or above, in bands of £5,000. 


Number of employees in band 

Remuneration band 

Number of employees in band 

2017-18 


2018-19 

1 

£105,000-£109,999 

1 

- 

£55,000 - £59,999 

1 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


24 






















Exit packages 

There were no exit packages during 2017—18 or 2018-19. 



Stephen Brown 
Chief Officer 



Cllr Robert Foster 
IJB Chair 


29 August 2019 


29 August 2019 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


25 



Financial statements 


The Comprehensive Income and Expenditure Statement shows the cost of providing services 
for the year according to accepted accounting practices. 


2017-18 

Net 

Expenditure 

£000 


Gross 

Expenditure 

£000 

2018-19 

Gross 

Income 

£000 

Net 

Expenditure 

£000 

63,268 

Community Care and Health 

65,751 

- 

65,751 

26,730 

Mental Health 

27,816 

- 

27,816 

35,535 

Children’s Services and Criminal Justice 

35,300 

- 

35,300 

49,518 

Primary Care 

48,839 

- 

48,839 

5,566 

Management and Support Costs 

6,306 

- 

6,306 

3,430 

Change Programme 

2,156 

- 

2,156 

- 

Allied Health Professionals 

4,588 

- 

4,588 

76,665 

Lead Partnership and Set Aside 

77,455 

- 

77,455 

260,712 

Cost of Services 

268,211 

- 

268,211 

(89,346) 

North Ayrshire Council Funding 

- 

(95,169) 

(95,169) 

(168,804) 

NHS Ayrshire & Arran Funding 

- 

(173,987) 

(173,987) 

(258,150) 

Totai Taxation And Non-Specific Grant 

Income (note 5) 


(269,156) 

(269,156) 

2,562 

(Surplus) or Deficit on Provision of 

Services 

268,211 

(269,156) 

(945) 


There are no statutory or presentation adjustments which affect the IJB’s application of the funding 
received from partners. The movement in the General Fund balance Is therefore solely due to the 
transactions shown in the Comprehensive Income and Expenditure Statement. Consequently an 
Expenditure and Funding Analysis is not provided in these annual financial statements. 

The Movement in Reserves Statement shows the movement in the year on the reserves held by 
the IJB. The movements which arise due to statutory adjustments which affect the General Fund 
balance are separately identified from the movements due to accounting practices. In 2018-19 there 
were no statutory adjustments. 


Total 

Reserves 

2017-18 

Movement in reserves 

General 
Fund 
Balance 
2018-19 

Unusable 

Reserves 

2018-19 

Total 
Reserves 
2018-19 

(3,245) 

Opening balance as at 1 April 

(5,807) 

0 

(5,807) 

(2,562) 

Total Comprehensive Income and Expenditure 

945 

0 

945 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


26 

























































0 

Adjustments between accounting basis and funding 
basis under regulations 

0 

0 

0 

(2,562) 

Increase or (decrease) in year 

945 

0 

945 

(5,807) 

Closing Balance as at 31 March 

(4,862) 

0 

(4,862) 


The Balance Sheet shows the value of the IJB’s assets and liabilities as at the balance sheet date. 
The net assets of the IJB (assets less liabilities) are matched by the reserves held by the IJB. 


31 March 2018 
£000 

Notes 

31 March 2019 

£000 

0 

Short Term Debtors 

6 

277 

(5,807) 

Long Term Creditors 

7 

(5,139) 

(5,807) 

Net Assets 


(4,862) 

(5,807) 

Usable Reserve: General Fund 

8 

(4,862) 

(5,807) 

Total Reserves 


(4,862) 


The Statement of Accounts present a true and fair view of the financial position of the Integration 
Joint Board as at 31 March 2019 and its income and expenditure for the year then ended. 

The unaudited financial statements were authorised for issue on 27 June 2019 and the audited 
financial statements will be authorised for issue on 29 August 2019. 



Caroline Whyte 
Chief Finance Officer 

29 August 2019 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


27 




















Notes to the financial statements 


NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES 

General principles 

The Financial Statements summarise the authority’s transactions for the 2018-19 financial year and 
its position at the year-end as at 31 March 2019. 

The North Ayrshire IJB was established under the requirements of the Public Bodies (Joint Working) 
(Scotland) Act 2014 and is a Section 106 body as defined in the Local Government (Scotland) Act 
1973. 

The Financial Statements are therefore prepared in compliance with the Code of Practice on Local 
Authority Accounting in the United Kingdom 2018-19, supported by International Financial 
Reporting Standards (IFRS), unless legislation or statutory guidance requires different treatment. 

The annual accounts are prepared on a going concern basis, which assumes that the IJB will 
continue In operational existence for the foreseeable future. Whilst the financial statements show 
an overall negative balance sheet position the Integration Scheme outlines the partnership 
arrangement between the Council and Health Board and the requirements for those organisations 
to underwrite the financial position of the IJB. 

The historical cost convention has been adopted. 

Accruals of expenditure and Income 

Activity is accounted for in the year that it takes place, not simply when cash payments are made or 
received. In particular: 

• Expenditure is recognised when goods or services are received and their benefits are used by 
the IJB. 

• Income Is recognised when the IJB has a right to the income, for instance by meeting any 
terms and conditions required to earn the income, and receipt of the income is probable. 

• Where income and expenditure have been recognised but settlement In cash has not taken 
place, a debtor or creditor is recorded in the Balance Sheet. 

• Where debts may not be received, the balance of debtors is written down. 

For the Integration Joint Board financial statements a debtor and/or creditor will be recorded where 
the partner contributions differ from the actual net expenditure in year, this allows any surplus or 
deficit on the provision of services to be transferred to the reserves held by the Integration Joint 
Board. 

Funding 

The IJB Is primarily funded through contributions from the statutory funding partners. North Ayrshire 
Council and NHS Ayrshire & Arran. Expenditure is incurred as the IJB commissions specified health 
and social care services from the funding partners for the benefit of service recipients in North 
Ayrshire. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


28 




Cash and cash equivalents 

The IJB does not operate a bank account or hold cash. Transactions are settled on behalf of the IJB 
by the funding partners. Consequently the IJB does not present a ‘Cash and Cash Equivalent’ figure 
on the balance sheet. The funding balance due to or from each funding partner as at 31 March is 
represented as a debtor or creditor on the IJB’s Balance Sheet. 

Employee benefits 

The IJB does not directly employ staff. Staff are employed by the funding partners who retain the 
liability for pension benefits payable in the future. The IJB therefore does not present a Pensions 
Liability on its Balance Sheet. 

The IJB has a legal responsibility to appoint a Chief Officer. More details on the arrangements are 
provided in the Remuneration Report. The charges from the employing partner are treated as 
employee costs. Where material the Chief Officer’s absence entitlement at 31 March is accrued, 
for example in relation to annual leave earned but not yet taken. 

Reserves 

The Integration Joint Board’s reserves are classified as either Usable or Unusable Reserves. The 
IJB’s only Usable Reserve is the General Fund. The balance of the General Fund as at 31 March 
shows the extent of resources which the IJB can use in later years to support service provision. 

The IJB’s only Unusable Reserve is the Employee Statutory Adjustment Account. This is required 
by legislation. It defers the charge to the General Fund for the Chief Officer’s absence entitlement 
as at 31 March, for example any annual leave earned but not yet taken. The General Fund is only 
charged for this when the leave is taken, normally during the next financial year. 

Indemnity insurance 

The IJB has indemnity insurance for costs relating primarily to potential claim liabilities regarding 
Board member and officer responsibilities. NHS Ayrshire & Arran and North Ayrshire Council have 
responsibility for claims in respect of the services that they are statutorily responsible for and that 
they provide. 

Unlike NHS Ayrshire & Arran, the IJB does not have any ‘shared risk’ exposure from participation in 
CNORIS (Clinical Negligence and Other Risks Indemnity Scheme). The IJB participation in the 
CNORIS scheme is therefore equivalent to normal insurance arrangements. 

Known claims are assessed as to the value and probability of settlement. Where it is material the 
overall expected value of known claims taking probability of settlement into consideration, is 
provided for in the IJB’s Balance Sheet. 

The likelihood of receipt of an insurance settlement to cover any claims is separately assessed and, 
where material, presented as either a debtor or disclosed as a contingent asset. 

VAT Status 

The IJB is a non-taxable body and does not charge or recover VAT on its functions. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


29 



NOTE 2 - CRITICAL JUDGEMENTS AND ESTIMATION UNCERTAINTY 


The critical judgements made in the Financial Statements relating to complex transactions are: 

• On behalf of all IJBs within the NHS Ayrshire & Arran area, the IJB acts as the lead partner for 
Mental Health Services. It commissions services on behalf of the three Ayrshire IJBs and 
reclaims the costs involved. This arrangement is treated as an agency arrangement. In the 
absence of an alternative agreement or approach being outlined in the Integration Scheme, 
the recharges across the partnerships for lead services are based on an NRAC share of costs, 
this may not reflect the actual cost of delivering services to the population in the three areas. 

• In applying the accounting policies, the IJB has had to make a critical judgement relating to the 
values included for Set Aside services. The Set Aside figure included in the IJB accounts is 
based upon Information Services Division Scotland (ISD) 2017-18 activity data at 2016-17 
prices with a 1% uplift applied. As such, the Set Aside sum included in the accounts will not 
reflect actual hospital usage in 2018-19. 

• There are no material estimation uncertainties included within the Financial Statements. 


NOTE 3 - EVENTS AFTER THE REPORTING PERIOD 

The audited annual financial statements will be authorised for issue by the Chief Finance Officer on 
29 August 2019. Events taking place after this date are not reflected in the financial statements or 
notes. 

Events after the Balance Sheet date are those events, both favourable and unfavourable, that occur 
between the end of the reporting period and the date when the Annual Accounts are authorised for 
issue. Two types of events can be identified: 

• Those that provide evidence of conditions that existed at the end of the reporting period - the 
financial statements are adjusted to reflect such events 

• Those that are indicative of conditions that arose after the reporting period - the financial 
statements are not adjusted to reflect for such events, but where a category of events would 
have a material impact disclosure is made in the notes of the nature of the events and their 
estimated financial effect. 

There are no events to report after the reporting period end. 


NOTE 4 - EXPENDITURE AND INCOME ANALYSIS BY NATURE 




2018-19 

£000’s 

114,099 

Services commissioned from North Ayrshire Council 

117,023 

146,589 

Services commissioned from NHS Ayrshire & Arran 

151,163 

24 

Auditor Fee: External Audit Work 

25 

(258,150) 

Partners Funding Contributions and Non-Specific Grant Income 

(269,156) 

(2,562) 

(Deficit) / Surpius on the Provision of Services 

945 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


30 










NOTE 5 - TAXATION AND NON-SPECIFIC GRANT INCOME 


2017-18 


2018 - 19 



(89,346) Funding Contribution from North Ayrshire Council 


£000’s 


(95,169) 


(168,804) Funding Contribution from NHS Ayrshire & Arran 


(173,987) 


(258,150) Taxation and Non-specific Grant Income 


(269,156) 


The funding contributions from the partners shown above exclude any funding which is ring-fenced 
for the provision of specific services. Such ring-fenced funding is presented as income in the Cost 
of Services in the Comprehensive Income and Expenditure Statement. There was no ring-fenced 
funding in 2017-18 or 2018-19. 

The funding contribution from NHS Ayrshire & Arran shown above includes £30.114m (2017-18 
£28.055m) in respect of ‘set aside’ resources reiating to acute hospital and other resources. These 
are provided by the NHS which retains responsibiiity for managing the costs of providing the 
services. The IJB however has responsibility for the consumption of, and ievel of demand piaced 
on, these resources. 


NOTE 6 - DEBTORS 



North Ayrshire Council 



0 

NHS Ayrshire & Arran 

146 

0 

Total Debtors 

277 


Amounts owed to the funding partners are stated on a net basis. Debtor and Creditor baiances 
recognised by the funding partners but not yet settled in cash terms are offset against the funds they 
are hoiding on behaif of the Integration Joint Board. 

NOTE 7 - CREDITORS 


31 March 2018 


31 March 2019 

£000’s 


£000’s 

(5,807) 

North Ayrshire Council 

(5,139) 

0 

NHS Ayrshire & Arran 

0 

(5,807) 

Total Creditors 

(5,139) 


Amounts owed to the funding partners are stated on a net basis. Debtor and Creditor baiances 
recognised by the funding partners but not yet settied in cash terms are offset against the funds they 
are hoiding on behaif of the Integration Joint Board. 

The Debtor baiances recognised on the Baiance Sheet represent the vaiue of reserves held by 
partners supporting the earmarked element of the General Fund balance. The remaining balance 
of the surplus on the provision of services is offset against the Creditor in reiation to the outstanding 
debt to North Ayrshire Councii. This is in line with the amounts owed to funding partners being 
stated on a net basis irrespective of settlement in cash terms. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


31 























This position is summarised below: 


Funding Partner 

Surplus on provision 
of services 

£000’s 

Earmarked Balance 

£000’s 

Uncommitted Surplus 

£000’s 

North Ayrshire Council 

389 

(131) 

258 

NHS Ayrshire & Arran 

556 

(146) 

410 

Total 

945 

(277) 

668 


NOTE 8 - USABLE RESERVE: GENERAL FUND 

The IJB holds a balance on the General Fund which will normally comprise one of three elements: 

• As a working balance to help cushion the impact of uneven cash flows. 

• As a contingency to manage the impact of unexpected events or emergencies. 

• As a means of building up funds, often referred to as earmarked reserve, to meet known or 
predicted liabilities. 

The table below shows the movements on the General Fund balance, analysed between those 
elements earmarked for specific planned expenditure and the amount held in unallocated reserves. 

Action 15 and the Primary Care Improvement Fund (PCIF) are Scottish Government allocations 
which require to be carried forward for use in future years. 

The IJB has an overall negative reserves position with the unallocated balance representing the 
balance of payment due to North Ayrshire to repay the debt due for previous year deficits, the 
movement in this balance represents the repayment made during 2018-19. 



2017-18 




2018-19 


Transfers 

Out 

2017-18 

Transfers 

In 2017-18 

Balance at 
31 March 
2018 


Transfers 

Out 

2018-19 

Transfers 

In 2018-19 

Balance at 

31 March 
2019 

Earmarked 

Funds 

0 

0 

0 

: Alcohol & Drug 
Partnership 

0 

131 

131 

0 

0 

0 

: Action 15 

0 

116 

116 

0 

0 

0 

: PCIF 

0 

30 

30 

0 

0 

0 

Total Earmarked 

0 

277 

277 

0 

(2,562) 

(5,807) 

Unallocated 

General Fund 

0 

668 

(5,139) 

0 

(2,562) 

(5,807) 

General Fund 

0 

945 

4,862 


NOTE 9 - AGENCY INCOME AND EXPENDITURE 

On behalf of all IJBs within the NFIS Ayrshire & Arran area, the IJB acts as the lead manager for 
Mental Health Services and Children’s Services. It commissions services on behalf of the other IJBs 
and reclaims the costs involved. The payments that are made on behalf of the other IJBs, and the 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


32 



















consequential reimbursement, are not included in the Comprehensive Income and Expenditure 
Statement (CIES) since the IJB is not acting as principal in these transactions. 

The amount of expenditure and income relating to the agency arrangement is shown below. 


2017-18 


2018 - 19 


29,685 


Expenditure on Agency Service 



29,018 


(29,685) 


Reimbursement for Agency Services 


(29,018) 


Net Agency Expenditure Excluded from the CIES 


NOTE 10 - RELATED PARTY TRANSACTIONS 

The IJB has related party relationships with NHS Ayrshire & Arran and North Ayrshire Council. In 
particular the nature of the partnership means that the IJB may influence, and be influenced by, its 
partners. The following transactions and balances included in the IJB’s financial statements are 
presented to provide additional information on the relationships. 


2017-18 

£000 

Transactions with NHS Ayrshire & Arran 

2018-19 

£000 

(168,804) 

Funding Contributions received from NHS Board 

(173,987) 

0 

Service Income received from NHS Board 

0 

146,548 

Expenditure on Services Provided by NHS Board 

151,121 

53 

Key Management Personnel: Non-Voting Board Members 

54 

0 

Support Services 

0 

(22,203) 

Net Transactions with NHS Board 

(22,812) 


31 March 2018 
£000 

Balances with NHS Ayrshire & Arran 

31 March 2019 
£000 

0 

Debtor Balances: Amounts due from NHS Board 

146 

0 

Creditor Balances: Amounts due to NHS Board 

0 

0 

Net Balances with NHS Board 

146 


2017-18 

£000 

Transactions with North Ayrshire Council 

2018-19 
£000 

(89,346) 

Funding Contributions received from the Council 

(95,169) 

0 

Service Income received from the Council 

0 

114,058 

Expenditure on Services Provided by the Council 

116,981 

53 

Key Management Personnel: Non-Voting Board Members 

55 

0 

Support Services 

0 

24,765 

Net Transactions with the Council 

21,867 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


33 
































31 March 2018 
£000 

Balances with North Ayrshire Councii 

31 March 2019 
£000 

0 

Debtor Balances: Amounts due from the Council 

131 

(5,807) 

Creditor Balances: Amounts due to the Council 

(5,139) 

(5,807) 

Net Balances with the Council 

(5,008) 


There are key management personnel employed by NHS Ayrshire & Arran and North Ayrshire 
Council, these costs are included in the expenditure on services provided. The non-voting Board 
members employed by the Council and Health Board include the Chief Officer, Chief Finance 
Officer, Chief Social Work Officer, representatives of primary care, nursing and non-primary care 
services; and a staff representative. Details of the remuneration for some specific post-holders is 
provided in the Remuneration Report. 

Support services were not delegated to the Integration Joint Board through the Integration Scheme 
and are instead provided by NHS Ayrshire & Arran and North Ayrshire Council free of charge as 
‘services in kind’. These include services such as financial management, human resources, legal 
services, committee services, ICT, payroll, internal audit and accommodation. 

NOTE 11 - VAT 

VAT payable is included as an expense only to the extent that it is not recoverable from Her 
Majesty’s Revenue and Customs. VAT receivable is excluded from income. 

The VAT treatment of expenditure in the IJB’s financial statements depends on which of the partner 
agencies is providing the service as these agencies are treated differently for VAT purposes. 

Where the Council is the provider, income and expenditure excludes any amounts related to VAT, 
as all VAT collected is payable to H.M. Revenue and Customs and all VAT paid is recoverable from 
it. The Council is not entitled to fully recover VAT paid on a very limited number of items of 
expenditure and for these items the cost of VAT paid is included within service expenditure to the 
extent that it is irrecoverable from H.M. Revenue and Customs. 

Where the NHS is the provider, expenditure incurred will include irrecoverable VAT as generally the 
NHS cannot recover VAT paid as input tax and will seek to recover its full cost as income from the 
Commissioning IJB. 

NOTE 12 - ACCOUNTING STANDARDS ISSUED NOT YET ADOPTED 

The Code requires the disclosure of information about accounting changes that will be required by 
new accounting standards that has been issued but not yet adopted. The IJB considers that there 
are no such standards which would have an impact on the 2018-19 financial statements. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


34 









Independent auditor’s report 


Independent auditor’s report to the members of North Ayrshire Integration Joint Board and the 
Accounts Commission 

Report on the audit of the financial statements 

Opinion on financiai statements 

We certify that we have audited the financial statements in the annual accounts of North Ayrshire 
Integration Joint Board for the year ended 31 March 2019 under Part VII of the Local Government 
(Scotland) Act 1973. The financial statements comprise the Comprehensive Income and Expenditure 
Statement, Movement in Reserves Statement, Balance Sheet and notes to the financial statements, 
including a summary of significant accounting policies. The financial reporting framework that has been 
applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) 
as adopted by the European Union, and as interpreted and adapted by the Code of Practice on Local 
Authority Accounting in the United Kingdom 2018/19 (the 2018/19 Code). 

In our opinion the accompanying financial statements: 

• give a true and fair view in accordance with applicable law and the 2018/19 Code of the state of 
affairs of the North Ayrshire Integration Joint Board as at 31 March 2019 and of its income and 
expenditure for the year then ended; 

• have been properly prepared in accordance with IFRSs as adopted by the European Union, as 
interpreted and adapted by the 2018/19 Code; and 

• have been prepared in accordance with the requirements of the Local Government (Scotland) Act 
1973, The Local Authority Accounts (Scotland) Regulations 2014, and the Local Government in 
Scotland Act 2003. 

Basis for opinion 

We conducted our audit in accordance with applicable law and International Standards on Auditing 
(UK) (ISAs (UK)), as required by the Code of Audit Practice approved by the Accounts Commission for 
Scotland. Our responsibilities under those standards are further described in the auditor’s 
responsibilities for the audit of the financial statements section of our report. We were appointed by the 
Accounts Commission on 31 May 2016. The period of total uninterrupted appointment is three years. 
We are independent of the North Ayrshire Integration Joint Board in accordance with the ethical 
requirements that are relevant to our audit of the financial statements in the UK including the Financial 
Reporting Council’s Ethical Standard, and we have fulfilled our other ethical responsibilities in 
accordance with these requirements. Non-audit services prohibited by the Ethical Standard were not 
provided to the North Ayrshire Integration Joint Board. We believe that the audit evidence we have 
obtained is sufficient and appropriate to provide a basis for our opinion. 

Conclusions relating to going concern basis of accounting 

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require 
us to report to you where: 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


35 





• the use of the going concern basis of accounting in the preparation of the financial statements is 
not appropriate; or 


the Chief Finance Officer has not disclosed in the financial statements any identified material 
uncertainties that may cast significant doubt about North Ayrshire Integration Joint Board’s ability to 
continue to adopt the going concern basis of accounting for a period of at least twelve months from 
the date when the financial statements are authorised for issue. 


Risks of material misstatement 

We have reported in a separate Annual Audit Report, which is available from the Audit Scotland 
website , the most significant assessed risks of material misstatement that we identified and our 
conclusions thereon. 


Responsibilities of the Chief Finance Officer and North Ayrshire Integration Joint Board for the 
financial statements 


As explained more fully in the Statement of Responsibilities, the Chief Finance Officer is responsible 
for the preparation of financial statements that give a true and fair view in accordance with the financial 
reporting framework, and for such internal control as the Chief Finance Officer determines is 
necessary to enable the preparation of financial statements that are free from material misstatement, 
whether due to fraud or error. 


In preparing the financial statements, the Chief Finance Officer is responsible for assessing the North 
Ayrshire Integration Joint Board's ability to continue as a going concern, disclosing, as applicable, 
matters related to going concern and using the going concern basis of accounting unless deemed 
inappropriate. 

The North Ayrshire Integration Joint Board is responsible for overseeing the financial reporting 
process. 


Auditor’s responsibilities for the audit of the financial statements 


Our objectives are to obtain reasonable assurance about whether the financial statements as a whole 
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that 
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that 
an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it 
exists. Misstatements can arise from fraud or error and are considered material if, individually or in the 
aggregate, they could reasonably be expected to influence the economic decisions of users taken on 
the basis of these financial statements. 

The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting 
from error, as fraud may involve collusion, intentional omissions, misrepresentations, or the override of 
internal control. The capability of the audit to detect fraud and other irregularities depends on factors 
such as the skilfulness of the perpetrator, the frequency and extent of manipulation, the degree of 
collusion involved, the relative size of individual amounts manipulated, and the seniority of those 
individuals involved. We therefore design and perform audit procedures which respond to the 
assessed risks of material misstatement due to fraud. 


A further description of the auditor’s responsibilities for the audit of the financial statements is located 
on the Financial Reporting Council’s website www.frc.ora.uk/auditorsresponsibilities . This description 
forms part of our auditor’s report. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


36 






Other information in the annuai accounts 


The Chief Finance Officer is responsible for the other information in the annual accounts. The other 
information comprises the information other than the financial statements, the audited part of the 
Remuneration Report, and our auditor’s report thereon. Our opinion on the financial statements does 
not cover the other information and we do not express any form of assurance conclusion thereon 
except on matters prescribed by the Accounts Commission to the extent explicitly stated later in this 
report. 

In connection with our audit of the financial statements, our responsibility is to read all the other 
information in the annual accounts and, in doing so, consider whether the other information is 
materially inconsistent with the financial statements or our knowledge obtained in the audit or 
otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent 
material misstatements, we are required to determine whether there is a material misstatement in the 
financial statements or a material misstatement of the other information. If, based on the work we have 
performed, we conclude that there is a material misstatement of this other information, we are required 
to report that fact. We have nothing to report in this regard. 

Report on other requirements 

Opinions on matters prescribed by the Accounts Commission 

In our opinion, the audited part of the Remuneration Report has been properly prepared in accordance 
with The Local Authority Accounts (Scotland) Regulations 2014. 

In our opinion, based on the work undertaken in the course of the audit: 

• the information given in the Management Commentary for the financial year for which the financial 
statements are prepared is consistent with the financial statements and that report has been 
prepared in accordance with statutory guidance issued under the Local Government in Scotland 
Act 2003; and 

• the information given in the Annual Governance Statement for the financial year for which the 
financial statements are prepared is consistent with the financial statements and that report has 
been prepared in accordance with the Delivering Good Governance in Local Government: 
Framework (2016). 

Matters on which we are required to report by exception 

We are required by the Accounts Commission to report to you if, in our opinion: 

• adequate accounting records have not been kept; or 

• the financial statements and the audited part of the Remuneration Report are not in agreement with 
the accounting records; or 

• we have not received all the information and explanations we require for our audit; or 

• there has been a failure to achieve a prescribed financial objective. 

We have nothing to report in respect of these matters. 

Conclusions on wider scope responsibilities 

In addition to our responsibilities for the annual accounts, our conclusions on the wider scope 
responsibilities specified in the Code of Audit Practice, including those in respect of Best Value, are set 
out in our Annual Audit Report. 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


37 



Use of our report 


This report is made solely to the parties to whom it is addressed in accordance with Part VII of the 
Local Government (Scotland) Act 1973 and for no other purpose. In accordance with paragraph 120 of 
the Code of Audit Practice, we do not undertake to have responsibilities to members or officers, in their 
individual capacities, or to third parties. 


Pat Kenny, CPFA (for and on behalf of Deloitte LLP) 
110 Queen Street 
Glasgow 
G1 3BX 

United Kingdom 
29 August 2019 


North Ayrshire Integration Joint Board Annual Accounts to 31 March 2019 


38 



This document is available in other formats such as audio tape, CDF, braille and 
in large print. It can also be made available in other languages on request. 

All of our publications are available in different languages, larger print, braille 
(English only), audio tape or another format of your choice. 


Comments or questions about this document, including request for support 
information or documentation, should be made to: 

North Ayrshire Health and Social Care Partnership, 

Cunninghame House, Friars Croft, Irvine KA12 SEE 

Follow us on Twitter (S)NAHSCP 

For more information go to www.NAHSCP.org 





Delivering care 
together 



North Ayrshire 

Health and Social Care Partnership 


Delivering care 
together 


DIRECTOR (North Ayrshire Health & Social Care Partnership): Stephen Brown 
5'^ Floor West Wing, Cunninghame House, Friarscroft, Irvine KA12 SEE 

Our Ref: PK/NAIJ B/2019 

29 August 2019 
Deloitte LLP 
110 Queen Street 
Glasgow 
G1 3BX 

Our Ref: PK/NAIJB/2019 
Dear Sirs 

This representation letter is provided in connection with your audit of the financial 
statements of the North Ayrshire Integration Joint Board for the year ended 31 March 
2019 for the purpose of expressing an opinion as to whether the financial statements 
give a true and fair view of the financial position of the North Ayrshire Integration 
Joint Board as of 31 March 2019 and of the results of its operations, other 
comprehensive net expenditure and its cash flows for the year then ended in 
accordance with the Code of Practice on Local Authority Accounting in the United 
Kingdom (the Code). 

In addition to the above, this representation letter is provided in connection with your 
audit of the Management Commentary, Remuneration Report and Annual 
Governance Statement for the following purposes: 

• Expressing an opinion on the auditable part of the Remuneration Report as to 
whether it has been properly prepared in accordance with The Local Authority 
Accounts (Scotland) Regulations 2014; 

• Expressing an opinion as to whether the information given in the Management 
Commentary is consistent with the financial statements and that report has 
been prepared in accordance with statutory guidance issued under the Local 
Government in Scotland Act 2003; and 

• Expressing an opinion as to whether the information given in the Annual 
Governance Statement is consistent with the financial statements and that the 
report has been prepared in accordance with the Delivering Good 
Governance in Local Government Framework (2016). 


I am aware that it is an offence to mislead an external auditor. 





As Chief Finance and Transformation Officer and on behalf of the North Ayrshire 

Integration Joint Board, I confirm, to the best of my knowledge and belief, the 

following representations. 

Financial statements 

1 . I understand and have fulfilled my responsibilities for the preparation of the 
financial statements in accordance with proper practices as set out in the 
Code, which give a true and fair view, as set out in the terms of the audit 
engagement letter. 

2 . We have provided you with all relevant information and access as agreed in 
the terms of the audit engagement letter with Audit Scotland. We 
acknowledge our responsibilities for the design, implementation and operation 
of internal control to prevent and detect fraud and error. 

3. Significant assumptions used by us in making accounting estimates, including 
those measured at fair value, are reasonable. 

4. Related party relationships and transactions have been appropriately 
accounted for and disclosed in accordance with the requirements of IAS24 
“Related party disclosures”. 

5. All events subsequent to the date of the financial statements and for which the 
applicable financial reporting framework requires adjustment of or disclosure 
have been adjusted or disclosed. 

6. The effects of uncorrected misstatements and disclosure deficiencies are 
immaterial, both individually and in aggregate, to the financial statements as a 
whole. 

7. We confirm that the financial statements have been prepared on the going 
concern basis. We do not intend to liquidate the Board or cease trading as 
we consider we have realistic alternatives to doing so. We are not aware of 
any material uncertainties related to events or conditions that may cast 
significant doubt upon the Board’s ability to continue as a going concern. We 
confirm the completeness of the information provided regarding events and 
conditions relating to going concern at the date of approval of the financial 
statements, including our plans for future actions. 

8. We confirm that all of the disclosures within the Management Commentary, 
Remuneration Report and the Annual Governance Statement have been 
prepared in accordance with the relevant legislation and guidance. 

Information provided 

9. We have provided you with all relevant information and access. 

10 . All transactions have been recorded and are reflected in the financial 
statements and the underlying accounting records. 

11 . We acknowledge our responsibilities for the design, implementation and 
maintenance of internal control to prevent and detect fraud and error. 

12 . We have disclosed to you the results of our assessment of the risk that the 
financial statements may be materially misstated as a result of fraud. 

13. We are not aware of any fraud or suspected fraud that affects the entity and 
involves: 

(i) management; 

(ii) employees who have significant roles in internal control; or 

(iii) others where the fraud could have a material effect on the financial 
statements. 



14. We have disclosed to you all information in relation to allegations of fraud, or 
suspected fraud, affecting the entity’s financial statements communicated by 
employees, former employees, analysts, regulators or others. 

15. We are not aware of any instances of non-compliance, or suspected non- 
compliance, with laws, regulations, and contractual agreements whose effects 
should be considered when preparing financial statements 

16 . We have disclosed to you the identity of the entity’s related parties and all the 
related party relationships and transactions of which we are aware. 

17. No claims in connection with litigation have been or are expected to be 
received. 

We confirm that the above representations are made on the basis of adequate 
enquiries of management and staff (and where appropriate, inspection of evidence) 
sufficient to satisfy ourselves that we can properly make each of the above 
representations to you. 

Yours faithfully 


Signed as Chief Finance and Transformation Officer, and on behalf of the 
Board 




Deloitte 




NORTH AYRSHIRE 

Health and Social Care 
Partnership 


North Ayrshire Integration Joint Board 

Report to the Members of the IJB and the Controller of Audit 
on the 2018/19 audit 

Issued 6 August 2019 for the meeting on 29 August 2019 


Contents 


01 Our final report 

Introduction 3 

Our audit explained 6 

Financial statements audit 7 

Significant risks 8 

Our audit report 11 

Your annual report 12 

Audit dimensions 14 


Purpose of our report and 
responsibility statement 

19 

Audit adjustments 

20 

Action plan 

21 

Fraud responsibilities and 
representations 

22 

Independence and fees 

23 


2 



Introduction 

The key messages in this report 


Audit quality is our 
number one priority. 
We plan our audit to 
focus on audit quality 
and have set the 
following audit quality 
objectives for this 
audit: 

• A robust challenge 
of the key 
judgements taken 
in the preparation 
of the financial 
statements. 

• A strong 
understanding of 
your internal 
control 
environment. 

• A well planned and 
delivered audit that 
raises findings early 
with those charged 
with governance. 


I have pleasure in presenting our final report to the Members of North Ayrshire Integration Joint Board 
('the IJB' 'the Board') for the 2019 audit. The scope of our audit was set out within our planning report 
presented to the Performance and Audit Committee ('the Committee') in March 2019. 

This report summarises our findings and conclusions in relation to: 

• The audit of the financial statements; and 

• Consideration of the four audit dimensions that frame the wider scope of public sector audit 
requirements as illustrated in the following diagram. This includes our consideration of the Board's 
duty to secure best value. 



Financial 

sustainability 


Value 
for money 




Introduction (continued) 

The key messages in this report (continued) 


I would like to draw your attention to the key messages of this paper: 


Conclusions from our testing 

Based on our audit work completed to date we expect to issue an 
unmodified audit opinion. 

The management commentary and annual governance statement 
comply with the statutory guidance and proper practice and are 
consistent with the financial statements and our knowledge of the 
Boa rd. 

The auditable parts of the remuneration report have been prepared in 
accordance with the relevant regulation. 

A summary of our work on the significant risks is provided in the 
dashboard on page 8. 

No misstatements in excess of our reporting threshold of £187k or 
disclosure deficiencies have been identified up to the date of this 
report. 


Status of the financial statements audit 

Outstanding matters to conclude the audit include: 

• Journal entry testing; 

• Finalisation of internal quality control procedures; 

• Receipt of final financial statements; 

• Receipt of signed management representation letter; and 

• Our review of events since 31 March 2019. 


Conclusions on audit dimensions 

As set out on page 3, our audit work covered the four audit dimensions. 
This incorporated the specific risks highlighted by Audit Scotland, in 
particular, the impact of EU withdrawal, the changing landscape for 
public financial management, dependency on key suppliers and 
increased focus on openness and transparency. 

Our detailed interim report, presented to the Board in June 2019, set 
out our findings and conclusions on each dimension. We have updated 
this for any significant changes since that report and our overall 
conclusion on each dimension is summarised on pages 16-17. 


4 



Introduction (continued) 

The key messages in this report (continued) 


Conclusions on audit dimensions (continued) 

Financial sustainability 

The IJB achieved short-term financial balance in 2018/19 and a 
balanced budget has been set for 2019/20; however, this includes 
significant efficiencies and service transformation programmes to be 
delivered. 

It is positive that the IJB has started to repay the debt due to North 
Ayrshire Council arising from previous year overspends, albeit less than 
initially planned, with the remainder being repaid in future years. 

In the medium term, the IJB is faced with a challenging financial 
position as the current level of service provision is not financially 
sustainable. In response to this, the Medium Term Financial Plan 
(MTFP) is due to be updated in 2019/20, with the Transformation Board 
driving the delivery of transformational change. 

Financial management 

Improvements have been made to the quality and frequency of 
financial monitoring reports and there is now an effective integrated 
budget monitoring arrangement in place. We have also noted that the 
financial management arrangements have strengthened during the 
year, including the reliability and accuracy of financial projections and 
financial processes. 

There were variations between the financial projections and the year- 
end position resulting in less being repaid to North Ayrshire Council 
than was planned. The IJB has identified discrete areas of focus to 
improve financial projections in future years to ensure this situation 
does not re-cur. 

Governance and transparency 

The IJB has a good attitude to openness and transparency and there is 
a supportive culture that underpins this. 

It is positive to note that the Board, along with its NHS and Council 
partners, are reviewing and updating the governance arrangements for 
the IJBs to take cognisance of the experience from early integration. 


Value for money 

The IJB has a performance management framework in place, with 
performance regularly considered by management, and the Performance 
and Audit Committee. It clearly reports on its contribution towards the 
national outcomes through its quarterly and annual performance reports. 

While there are some areas reporting a decline in performance, the 
Partnership Performance Reports set out how the IJB intends to address 
each area of under performance. In particular, there is a focus on trying to 
shift the balance of care from a hospital to a community setting. 

Our conclusions are included on pages 8 to 17 of this report and also 
included in our interim report to the Board in June 2019. 

We will consider progress with the agreed actions as part of our 2019/20 
audit. 


Added value 

Our aim is to add value to the IJB by providing insight into, and offering 
foresight on, financial sustainability, risk and performance by identifying 
areas for improvement and recommending and encouraging good practice. 
In so doing, we aim to help the IJB promote improved standards of 
governance, better management and decision making, and more effective 
use of resources. 

This is provided throughout this report and our separate interim report. In 
particular, our separate "Sector Developments" report, presented along 
with our interim report shared our research, informed perspective and best 
practice from our work across the wider public sector that are specifically 
relevant to the IJB. 


Pat Kenny 
Audit Director 


5 


Our audit explained 


Area dimensions 

In accordance with the 2016 Code 
of Audit Practice, we have 
considered how you are 
addressing the four audit 
dimensions: 

• Financial sustainability 

• Financial management 



• Governance and transparency 

• Value for money 


Significant risks 

Our risk assessment 
process is a continuous 
cycie throughout the year. 
Page 8 provides a summary 
of our risk assessment of 
your significant risks. 


i 



Our audit 
report 


Conclude ^ 
on significant 
risk areas 
and other 
findings 


Identify 
changes in 
your 

business and 
environment 


Determine 

materiality 


Significant 

risk 

assessment 


Scoping 


Materiality 

Materiality of £3,754k 
(2017/18 £3,649k) and 
performance materiality of 
£3,003k (2017/18 £2,736k) 
has been based on the 
benchmark of gross 
expenditure and is a slight 
increase from what we 
reported in our planning 
paper due to updated final 
figures. 

We have used these as the 
basis for our scoping 
exercise and initial risk 
assessment. We have 
reported to you all 
uncorrected misstatements 
greater than £187k 
(2017/18 £182k). 


Quality and Independence 

We confirm we are independent of North 
Ayrshire IJB. We take our independence 
and the quaiity of the audit work we 
perform very seriously. Audit quality is 
our number one priority. 


Scope of the audit 

We have audited the financial statements for the year ended 31 
March 2019 of North Ayrshire IJB. 


Tinneline 

2018/19 



t 


6 






























Financial statements audit 














Significant risks 
Dashboard 


Risk 


Completeness and accuracy of 
income 

Management override of controls 


Material 


Fraud 

risk 


Planned 
approach to 
controls 
testing 


0 0 
0 0 


Overly prudent, likely Overly optimistic, likely 

to lead to future credit Gv Gv to lead to future debit. 


Controls 

testing 

conclusion 


Consistency of 
judgements with 
Deloitte's 
expectations 


Comments 


Page no. 


Satisfactory 



Satisfactory 


9 


Satisfactory 



Satisfactory 


10 


D+I: Testing of the design and implementation of key controls 


8 










Significant risks (continued) 

Risk 1 - Completeness and accuracy of income 


Risk identified 

ISA 240 states that when identifying and assessing the risks of material misstatement due to fraud, the auditor shall, based on a presumption 
that there are risks of fraud in income recognition, evaluate which types of income, income transactions or assertions give rise to such risks. The 
main components of income for the IJB are contributions from its funding partners, namely North Ayrshire Council (NAC) and NHS Ayrshire and 
Arran (NHS A&A). The significant risk is pinpointed to the recognition of this income, being completeness and accuracy of contributions received 
from North Ayrshire Council and NHS Ayrshire & Arran. 


@ 

Key judgements and our challenge of them 

Given the year end deficit projected by the IJB, there is a risk that overspends 
could be funded by funding partners in the year following their approval, and 
therefore contributions could differ from the approved budget. 



Deloitte response 

We have performed the following: 

• tested the income to ensure that the correct contributions have been input 
and received in accordance with that agreed as part of budget process and 
that any reductions have been appropriately applied; 

• tested the reconciliations performed by the IJB at 31 March 2019 to confirm 
all income is correctly recorded in the ledger; 

• confirmed that the reconciliations performed during 2018/19 have been 
reviewed on a regular basis; and 

• assessed management's controls around recognition of income. 


Funding Analysis 

180,000 
160,000 
140,000 
120,000 
g 100,000 

t 4 j 80,000 
60,000 
40,000 
20,000 
0 

Funding Contribution Funding Contribution 
NAC NHS A&A 

■ 2017/18 ■ 2018/19 


Deloitte view 

We have concluded that income has been correctly recognised in accordance with the requirements of the Code of Practice on Local Authority 
Accounting. 


9 



Significant risks (continued) 

Risk 2 - Management override of controls 


Risk identified 

In accordance with ISA 240 (UK) management override 
is a significant risk. This risk area includes the potential 
for management to use their judgement to influence the 
financial statements as well as the potential to override 
the Board's controls for specific transactions. 

© 

Key judgements 

The key judgments in the financial statements are those 
which we have selected to be the significant audit risks 
around the completeness and accuracy of income (page 
9). This is inherently the area in which management 
has the potential to use their judgement to influence 
the financial statements. 



Deloitte response 

We have considered the overall sensitivity of 
judgements made in preparation of the financial 
statements, and note that: 

• The Board's results throughout the year were 
projecting overspends in operational areas. This was 
closely monitored and whilst projecting overspends, 
the underlying reasons were well understood; and 

• Senior management's remuneration is not tied to 
particular financial results. 

We have considered these factors and other potential 
sensitivities in evaluating the judgements made in the 
preparation of the financial statements. 


Significant and unusuai transactions 

We did not identify any significant 
transactions outside the normal course of 
business or any transactions where the 
business rationale was not clear. 


Journals 

We have performed design and 
implementation testing of the controls in 
place for journal approval. 

We have used data analytics to risk assess 
journals and select items for detailed follow 
up testing. The journal entries were selected 
using computer-assisted profiling based on 
areas which we consider to be of increased 
interest. 

We have tested the appropriateness of 
journal entries recorded in the general ledger, 
and other adjustments made in the 
preparation of financial reporting. No issues 
were noted based upon the work performed 
thus far. 


Accounting estimates 

We reviewed the financial statements for 
accounting estimates which could include 
biases that could result in material 
misstatements due to fraud. No accounting 
estimates have been recognised in the 
financial statements. 

We considered any adjustments required for 
the transition to the new standards (IFRS 15 
Revenues from contracts with customers and 
IFRS 9 Financial Instruments), focusing on 
the areas of greatest judgement and value. 

No issues have been identified from our 
testing. 


Deloitte view 

We have not identified any significant bias in the key judgements made by 
management based on work performed. 

We have not identified any instances of management override of controls in relation to 
the specific transactions tested based on work performed to date. 

We agree with management's position that the new accounting standards do not have 
a material impact for the Board. 


10 



Our audit report 

Other matters relating to the form and content of our report 


Here we discuss how the results of the audit impact on other significant sections of our audit report. 






Our opinion on the financial 
statements 

Based on our audit work 
completed to date, we 
anticipate issuing an 
unmodified opinion on the 
financial statements. 


Material uncertainty related 
to going concern 

We have not identified a 
material uncertainty related to 
going concern and will report 
by exception regarding the 
appropriateness of the use of 
the going concern basis of 
accounting. 

Whilst the IJB is faced with 
financial sustainability issues 
(discussed on page 16), the 
Code of Practice on Local 
Authority Accounting requires 
authorities to prepare its 
financial statements on a going 
concern basis unless there is 
an intention by government 
that the services provided by 
the authority will no longer be 
required. 


Emphasis of matter and 
other matter paragraphs 

There are no matters we judge 
to be of fundamental 
importance in the financial 
statements that we consider it 
necessary to draw attention to 
in an emphasis of matter 
paragraph. 

There are no matters relevant 
to users' understanding of the 
audit that we consider 
necessary to communicate in 
an other matter paragraph. 


Other reporting 
responsibilities 

The Annual Report is reviewed 
in its entirety for material 
consistency with the financial 
statements and the audit work 
performance and to ensure that 
they are fair, balanced and 
reasonable. 

Our opinion on matters 
prescribed by the Controller of 
Audit are discussed further on 
pages 12-13. 



11 


Your annual report 

We are required to provide an opinion on the auditable parts of the remuneration report, the annual governance statement and whether 
the management commentary has been prepared in accordance with the statutory guidance.. 


Requirement 


Deloitte response 


Management 

Commentary 


The Management Commentary comments on 
financial performance, strategy and 
performance review and targets. The 
commentary included both financial and non 
financial KPIs and made good use of graphs 
and diagrams. The Board also focusses on 
the strategic planning context. 


We have assessed whether the Management Commentary has been 
prepared in accordance with the statutory guidance. 

We have also read the Management Commentary and confirmed that the 
information contained within is materially correct and consistent with our 
knowledge acquired during the course of performing the audit, and is not 
otherwise misleading. 

Our review identified a number of areas of good practice with the inclusion 
of graphics and tables to aid the user's understanding of the annual report 
and accounts. 


Our review identified a number of areas where the annual accounts needed 
revising in order to comply with statutory guidance and to ensure that they 
were fair, balanced and understandable. We are pleased to note that these 
changes have been made. 

We have made a number of recommendations for changes to the annual 
accounts in line with good practice. We have included elements of good 
practice for your consideration at page 13. 


Remuneration The remuneration report has been prepared We have audited the disclosures of remuneration and pension benefits, pay 

Report in accordance with the 2014 Regulations, bands and exit packages and confirmed that they have been properly 

disclosing the remuneration and pension prepared in accordance with the regulations, 
benefits of the Chief Officer and Chief 
Finance Officer. 


Annual 

Governance 

Statement 


The Annual Governance Statement reports We have assessed whether the information given in the Annual Governance 
that the IJB's governance arrangements Statement is consistent with the financial statements and has been 
provide assurance, are adequate and are prepared in accordance with the accounts direction. No exceptions noted, 
operating effectively. 


12 







Your annual report (continued) 

Good practice note - improving quality of annual accounts 


Audit Scotland have issued a series of Good Practice notes to highlight 
where Annual Reports can be improved. One specifically directed at 
Integration Joint Boards was published in April 2018. We have highlighted 
below some of the key messages from this guidance note and pleased to 
note that a number of areas have been considered in drafting the 2018/19 
annual accounts and would encourage the Board to consider further areas 
of good practice in future annual accounts. 

We have also benchmarked the length of the draft 2018/19 annual report 
against other IJBs. North Ayrshire Council sits around the average length, 
however, minor improvements could be made in the content including the 
removal of all zero balances and the inclusion of an action plan outlining 
how the prior year's significant risks were addressed during the year. 


Length of narrative benchmarking 


Annual Governance Statement 
Remuneration Report 
Statement of Responsibilities 
Management Commentary 



0 5 10 15 


■ Max BMin aAverage ■ North Ayrshire 


20 


Key messages 


A single story 

• The narrative in the management commentary and annual governance statement should be consistent with the 
accounting information in the financial statements. 

• Significant points in the financial statements should be explained in the management commentary. 

o 

How funding 
was used 

• The management commentary should give a clear and balanced account of how funding was used. 

• Explanations of the IJB's business model should be provided. 

• The salient features of the IJB's performance and position should be explained in a balanced way. 

o 

What worries 

board 

members 

• The risks and uncertainties described in the management commentary should genuinely be the principal risks and 
uncertainties that the board members are concerned about. 

• The descriptions should be sufficiently specific that users can understand why they are important to the board 
members. 

• The management commentary and annual governance statement should describe the mitigating actions to manage 
the impact of the principal risks and uncertainties and significant governance weaknesses. The links to accounting 
estimates and judgements should be clear. 

o 

Consistency 

• Highlighted or adjusted figures, key performance indicators and other measures referred to in the management 
commentary should be clearly reconciled to the relevant amounts in the financial statements. 

• Any adjustments to the figures in the management commentary should be clearly explained, together with the 
reasons why they are being made. 

o 

Cut the clutter 

• Important messages, policies and transactions should be highlighted and supported with relevant context and not 
obscured by immaterial detail. 

• Cross-referencing and signposting should be used effectively, and repetition avoided. 

o 

Summarise 

• Items should be reported at an appropriate level of aggregation. 

• Tables should be supported by, and consistent with, the accompanying narrative. 

o 

Explain change 

• Significant changes from the prior period, whether matters of policy or presentation, should be properly explained 

o 

True and fair 

• The spirit as well as the letter of proper accounting practices should be followed. 

o 


e No issues noted Requires improvement 









Audit dimensions 
















Audit dimensions 
Overview 


Public audit in Scotland is wider in scope than financial audit. This section of our report sets out our conclusions on our audit work covering the 
following area, with our detailed findings and conclusions reported to the Board in June 2019 as part of our Interim Report . Our report is structured 
in accordance with the four audit dimensions, but also covers our specific audit requirements on best value and specific risks as summarised below. 



r 



Financial 

sustainability 






Financial 

management 


✓ 




Audit Dimensions 


Best Vaiue (BV) 

It is the duty of the IJB to secure BV as prescribed in the Local 
Government (Scotland) Act 1973. 

We have considered the Board's duty to secure BV as part of 
the governance arrangements considered as part of the audit 
dimensions work. 


Specific risks 

As set out in our Annual Audit Plan, Audit Scotland had identified a 
number of specific risks faced by the public sector which we have 
considered as part of our work on the four audit dimensions. 

• EU Withdrawal 

• Changing landscape for public financial management 

• Dependency on key suppliers 

• Openness and transparency 

• Our conclusions on the above were reported in our Interim 
Report to the Board in June. 


15 





























Audit dimensions (continued) 

Financial sustainability and financial management 


Financial sustainability looks forward to the medium and longer term to ■ Financial management is concerned with financial capacity, 

consider whether the body is planning effectively to continue to deliver its I sound budgetary processes and whether the control environment 

services or the way in which they should be delivered. I and internal controls are operating effectively. 


Key facts: 

2018/19 financial position 

• £945k underspend against budget after £l,486k being transferred 
back from North Ayrshire Council which was held on the IJB's behalf. 

• £668k repayment to North Ayrshire Council during 2018/19 with 
outstanding debt of £5,139k as at 31 March 2019. 

2019/20 financial position 

• £6,134k savings required. 

Overall conclusions 

The IJB achieved short-term financial balance in 2018/19 and commenced 
repayment of the historic debt outstanding to North Ayrshire Council. A 
balanced budget has been set for 2019/20; however, this includes 
significant efficiencies and service transformation programmes that need 
to be achieved in order for a balanced budget to be maintained. 

In the medium term, the IJB is faced with an extremely challenging 
financial position as the current level of service provision is not financially 
sustainable. The Transformation Board has been established to drive the 
delivery of transformational change at the required scale and pace to set 
the direction for the Strategic Plan 2018-21. A Medium Term Financial Plan 
is in place covering the period 2017/18 to 2019/20, which sets out the key 
demand pressures and funding assumptions over the five year period. This 
is due to be updated in 2019/20 and should to take account of issues set 
out in the Scottish Government's five-year Medium Term Financial 
Strategy, its Health and Social Care Medium Term Financial Framework 
and the work of the Transformation Board. 

As part of the 2019/20 transformation programme, the IJB are launching a 
"Thinking Different, Doing Better" programme aimed at educating staff and 
the wider public on the role of the partnership and of the case for change. 
This is a significant commitment but should be highlighted as a good 
practice example of engaging with key stakeholders to inform future 
decision making and drive towards shifting the balance of care from a 
hospital to a community setting. 


Key facts: 

2018/19 budget 

• Final budgeted expenditure of £267,909k, against actual 
expenditure of £268,211k. 

• Savings of £4,043k achieved, against a savings requirement of 
£6,615k. 

• Overspends reported during the year. 

• Regular reporting to senior management and board members. 

Overall conclusions 

The IJB achieved an underspend of £945k in 2018/19, after 
£l,486k is transferred back from North Ayrshire Council which was 
held on behalf of the IJB. The IJB repaid a sum of £668k towards 
the outstanding debt to the Council. It was envisaged that during 
the year the first instalment of the repayment would be £l,500k; 
however, a surplus of that value was not generated due to 
variations between projections and actual costs at the financial 
year-end. The IJB has identified discrete areas of focus to improve 
financial projections in future years to ensure this situation does not 
re-cur. 

The final outturn position is a significant improvement on the 
overspend position that was expected earlier in the year, 
particularly given historical overspends in previous years. 
Improvements have been made to the quality and frequency of 
financial monitoring reports and there is now an effective integrated 
budget monitoring arrangement in place. The appointment of the 
Chief Finance and Transformation Officer has been pivotal in the 
significant improvement of the IJB's financial position. 

It is positive to note that work is ongoing nationally, with Ayrshire 
and Arran acting as the test area for further work to be on 
Directions/ Set Aside resources as part of the national Review of 
Progress of Integration of Health and Social Care. 







Audit dimensions (continued) 

Governance and transparency and value for money 


Governance and transparency is concerned with the effectiveness 

of scrutiny and governance arrangements, leadership and decision Value for money is concerned with using resources effectively and 

making, and transparent reporting of financial and performance continually improving services. 

information. 


Key facts: 

• Strategic Plan 2018-2021 approved in April 2018. 


Overall conclusions 

In general, the IJB has a good attitude to openness and transparency 
and there is a supportive culture that underpins this. This could be 
further enhanced by publishing the papers and minutes of the 
Performance and Audit Committee online. 

There are a number of key governing documents which have not 
been reviewed or refreshed by the Board since 2015. A schedule of 
key governance documents including review timescales and 
responsible officers were submitted to the Performance and Audit 
committee in June 2019. Thereafter progress with document reviews 
will be monitored through the Performance and Audit Committee. 

It is positive to note that the Board, along with its NHS and Council 
partners, are reviewing and updating the governance arrangements 
for the IJBs to take cognisance of the experience from early 
integration. 


Key facts: 

• Between April 2018 and December 2018 overall performance 
has declined. There has been an Increase In the number of 
'red' Indicators reported from 5 to 10. 


Overall conclusions 

Best Value duties apply to accountable officers across the public 
sector. One of the key principles of the IJB integration scheme is 
making best use of public money by providing services that are 
efficient, effective and sustainable, and best value is a visible theme 
throughout IJB reports. One mechanism for the IJB ensuring Best 
Value is through the preparation of the annual performance report; 
the report assesses performance in relation to best value. 

The IJB has a performance management framework in place, with 
performance regularly considered by management and the 
Performance and Audit Committee. It clearly reports on its 
contribution towards the national outcomes through its quarterly and 
annual performance reports. 

While there is a decline in performance in some areas, the 
Partnership Performance Reports set out how the IJB intends to 
address each area of underperformance. In particular, there is a 
focus on trying to shift the balance of care from a hospital to a 
community setting. 

The budget also recognises the need to link expenditure to outcomes, 
but there is still a need to improve the links between budget and 

niil-rnmpc: 


17 














Purpose of our report and responsibility statement 

Our report is designed to help you meet your governance duties 


What we report 

Our report is designed to help 
the Board discharge their 
governance duties. It also 
represents one way in which we 
fulfil our obligations under ISA 
260 (UK) to communicate with 
you regarding your oversight of 
the financiai reporting process 
and your governance 
requirements. Our report 
includes: 

• Results of our work on key 
audit judgements and our 
observations on the quality 
of your Annual Report. 

• Our internal control 
observations. 

• Other insights we have 
identified from our audit. 


What we don't report 

As you will be aware, our audit 
was not designed to identify all 
matters that may be relevant to 
the Board. 

Also, there will be further 
information you need to 
discharge your governance 
responsibilities, such as matters 
reported on by management or 
by other specialist advisers. 


The scope of our work 

Our observations are developed 
in the context of our audit of 
the financial statements. We 
described the scope of our work 
in our audit plan and again in 
this report. 


This report has been prepared 
for the Board, as a body, and 
we therefore accept 
responsibility to you alone for 
its contents. We accept no 
duty, responsibility or liability 
to any other parties, since this 
report has not been prepared, 
and is not intended, for any 
other purpose. 


Finally, our views on internal 
controls and business risk 
assessment should not be 
taken as comprehensive or as 
an opinion on effectiveness 
since they have been based 
solely on the audit procedures 
performed in the audit of the 
financial statements and the 
other procedures performed in 
fulfilling our audit plan. 


We welcome the opportunity 
to discuss our report with 
you and receive your 
feedback. 



19 






Audit adjustments 

Summary of corrected and uncorrected misstatements and 
disclosure deficiencies 


No other corrected misstatements have been identified from our audit work performed to date. 


No uncorrected misstatements have been identified from our audit work performed to date. 


Auditing standards require us to highlight significant disclosure misstatements to enable audit committees to evaluate 
the impact of those matters on the financial statements. We have noted no material disclosure deficiencies in the 
course of our audit work to date. 


20 


Action plan 

Recommendations for improvement 


We have not made any recommendations for improvement arising from our financial statements audit. Our interim report submitted to the Board in 
June 2019 reported our detailed recommendations arising from our work on the wider audit dimensions. In this report, we made seven 
recommendations, as follows: 


Wider audit dimension 

Recommendations made 

Financial sustainability 

3 

Financial management 

1 

Governance and transparency 

3 


We will follow up these recommendations and report to the Committee on progress as part of our 2019/20 audit. 


In our interim report, we followed up on recommendations for improvement made in 2017/18. A summary of progress against 2017/18 actions has 
been included below. Of the three recommendations outstanding, all have an updated recommendation included above. Consequently, there are 
seven total recommendations which we will follow up in our 2019/20 audit. 


Area 

Recommendations made 

Recommendations impiemented 

Financial statements 

- 

- 

Financial sustainability 

3 

1 

Financial management 

1 

1 

Governance and transparency 

3 

2 


21 





















Fraud responsibilities and representations 
Responsibilities explained 


Responsibilities: 

The primary responsibility for the prevention and detection of 
fraud rests with management and those charged with 
governance, including establishing and maintaining internal 
controls over the reliability of financial reporting, effectiveness 
and efficiency of operations and compliance with applicable laws 
and regulations. As auditors, we obtain reasonable, but not 
absolute, assurance that the financial statements as a whole are 
free from material misstatement, whether caused by fraud or 
error. 



Required representations: 

We have asked the Board to confirm in writing that you have 
disclosed to us the results of your own assessment of the risk 
that the financial statements may be materially misstated as a 
result of fraud and that you are not aware of any fraud or 
suspected fraud that affects the entity. 

We have also asked the Board to confirm in writing their 
responsibility for the design, implementation and maintenance 
of internal control to prevent and detect fraud and error. 



Audit work performed: 

In our planning we identified the compieteness and accuracy of 
income and management override of controls as key audit risks 
for your organisation. 

During course of our audit, we have had discussions with 
management and those charged with governance. 

In addition, we have reviewed management's own documented 
procedures regarding fraud and error in the financial statements. 

We have reviewed the paper prepared by management for the 
Performance and Audit Committee on the process for identifying, 
evaluating and managing the system of internal financial control. 


Concerns: 

No concerns have been identified regarding fraud. 



22 



Independence and fees 


As part of our obligations under International Standards on Auditing (UK), we are required to report to you on the matters listed 
below: 


Independence We confirm that we comply with APB Ethical Standards for Auditors and that, in our professional 

confirmation judgement, we and, where applicable, all Deloitte network firms are independent and our objectivity is not 

compromised. 

Fees The audit fee for 2018/19, in line with the fee range provided by Audit Scotland, is £25,000 as broken 

down below: 

£ 


Auditor remuneration 

17,200 

Audit Scotland fixed charges: 


Pooled costs 

1,670 

Contribution to PABV 

5,050 

Audit support costs 

1,080 

Total agreed fee 

25,000 


No non-audit fees have been charged by Deloitte in the period. 

Non-audit services In our opinion there are no inconsistencies between APB Ethical Standards for Auditors and the company's 

policy for the supply of non-audit services or any apparent breach of that policy. We continue to review 
our independence and ensure that appropriate safeguards are in place including, but not limited to, the 
rotation of senior partners and professional staff and the involvement of additional partners and 
professional staff to carry out reviews of the work performed and to otherwise advise as necessary. 

Relationships We are required to provide written details of all relationships (including the provision of non-audit 

services) between us and the organisation, its board and senior management and its affiliates, including all 
services provided by us and the DTTL network to the audited entity, its board and senior management and 
its affiliates, and other services provided to other known connected parties that we consider may 
reasonably be thought to bear on our objectivity and independence. 

We are not aware of any relationships which are required to be disclosed. 



23 








Deloitte 


Deloitte LLP does not accept any liability for use of or reliance on the contents of this document by any person save by the intended 
recipient(s) to the extent agreed in a Deloitte LLP engagement contract. 

If this document contains details of an arrangement that could result in a tax or National Insurance saving, no such conditions of 
confidentiality apply to the details of that arrangement (for example, for the purpose of discussion with tax authorities). 

Deloitte LLP is a limited liability partnership registered in England and Wales with registered number OC303675 and its registered office at 1 
New Street Square, London EC4A 3HQ, United Kingdom. 

Deloitte LLP is the United Kingdom affiliate of Deloitte NSE LLP, a member firm of Deloitte Touche Tohmatsu Limited, a UK private company 
limited by guarantee ("DTTL"). DTTL and each of its member firms are legally separate and independent entities. DTTL and Deloitte NSE LLP 
do not provide services to clients. Please see www.deloitte.com/about to learn more about our global network of member firms. 

© 2019 Deloitte LLP. All rights reserved.