North Yorkshire Council

Audit Committee

15 December 2025

Annual Governance Statement mid-year review

Report of the Corporate Director, Strategic Resources

1.0 PURPOSE OF THE REPORT

1.1 To provide a mid-year progress update in respect of the significant governance and business challenges previously reported to the Audit Committee in June 2025 as part of the 2024/25 Annual Governance Statement.

2.0 SUMMARY

2.1      This mid-year governance update provides details of the progress made in addressing the key governance issues identified in the draft 2024/25 Annual Governance Statement (AGS).

2.2      Since the AGS was prepared, the Council has taken forward a series of actions in respect of the governance areas which were identified as requiring improvement. This report includes further details about those actions and provides an opportunity for the Audit Committee to assess the progress that has been made in strengthening the Council’s governance framework.

3.0 BACKGROUND

3.1      The Accounts and Audit Regulations (2015) require councils to undertake a review, at least annually, of the effectiveness of their system of internal control and to report the results as part of the Annual Governance Statement (AGS). The CIPFA/Solace Delivering Good Governance in Local Government framework provides further guidance on how the review should be conducted and the process that should be followed to prepare and approve the AGS. The guidance states that the review should be evidenced based, should focus on how the arrangements have met the principles of good governance in practice, and that assurance should be obtained through the year and not just at the year-end. 

3.2      The Council has established processes to complete the annual effectiveness review and to prepare the AGS. The draft 2024/25 AGS was presented to the Audit Committee on 23 June 2025 as part of the draft 2024/25 Statement of Accounts. Four significant governance and business challenges were identified which required attention in 2025/26 and beyond.

3.3      As part of developing the Councils internal governance arrangements, we have introduced a mid-year review process to provide an update on the progress made to address the significant governance and business challenges, to date.

4.0      PROGRESS UPDATE

4.1      Appendix 1 to this report provides greater detail on the actions taken in respect of the four significant governance and business challenges included in the 2024/25 AGS. Some of the key developments include:

· Information security - in November 2025, the Council successfully retained the ISO27001 information security accreditation. This provides assurance that the Council has in place the expected controls and processes to help protect information and effectively manage security risks.

· Transformation and savings delivery - an updated Transformation Strategy has recently been approved by Management Board. A number of programmes, service consolidated ways of working, restructures and other activities are helping support progress in this area.

· Capital projects - improvements to the capital gateway approval process and Capital Boards (who overview and scrutinise capital projects and expenditure) have recently been agreed. These changes are intended to deliver consistent project governance, accountability and decision making.

· Data and Systems – a council wide data strategy has been written and was considered by Management Board in October 2025. A finalised strategy will be agreed shortly.

4.2      Officers are continuing to plan and implement further actions to ensure improvements in governance are made. Progress will also be formally assessed as part of the review of effectiveness which will inform the preparation of the 2025/26 AGS.  

5.0       FINANCIAL IMPLICATIONS

5.1      There are no financial implications

6.0      LEGAL IMPLICATIONS

6.1      There are no legal implications

7.0      EQUALITIES IMPLICATIONS

7.1      There are no equalities implications

8.0      CLIMATE CHANGE IMPLICATIONS

8.1      There are no climate change implications

9.0      RISK MANAGEMENT IMPLICATIONS

9.1      Risk management is an element of the Council’s corporate governance framework. Effective risk management processes are therefore important to ensuring the achievement of the Council’s objectives.

10.0 RECOMMENDATIONS

10.1    To note the progress in 2025/26 in respect of the significant governance and business challenges previously reported as part of the 2024/25 Annual Governance Statement.

Gary Fielding

Corporate Director – Resources

County Hall

Northallerton

Report prepared and presented by Max Thomas, Head of Internal Audit

Veritau - Assurance Services for the Public Sector

County Hall

Northallerton 

3 December 2025

Appendix 1: 2024/25 AGS mid-year progress update