Agenda item

To receive a report by the Head of Internal Audit Services (copy enclosed) updating members on Internal Audit progress.

The Head of Internal Audit (HIA) submitted a report (previously circulated) updating members on Internal Audit progress in terms of its service delivery, assurance provision, reviews completed, performance and effectiveness in driving improvement.

Internal Audit progress reports had previously been shared with members outside the formal agenda with only audits having a ‘low’ or ‘no’ assurance rating being discussed at committee.  To provide a more balanced view and allow the committee to formally monitor Internal Audit’s progress and performance a new style progress update had been designed to be presented to each committee meeting.

The HIA guided members through the report which provided an update as at the end of October 2016 on –

·         Internal Audit reports recently issued (Payments of External Providers – Community Support Services; Housing Allocations & Voids; Public Transport)

·         Follow up of previous Internal Audit reports (Strategic HR; Management and Administration of Legal Services)

·         Progress in delivering the Internal Audit Operational Plan 2016/17

·         Internal Audit performance standards

The following matters were raised during debate –

·         some discussion focused on audit reports recently issued in respect of ‘Payments to External Providers – Community Support Services’ and ‘Public Transport’ and the need to ensure that regular financial checks were carried out to certify that providers were financially sound and not experiencing financial difficulties that may lead to problems in continuation of the service.  It was noted that the issue was more of a problem for service areas which relied heavily on a small number of providers and the need for financial checks had been referenced in the Procurement Review and Contract Procedure Rules

·         the importance of business continuity planning was highlighted and the committee was advised that each service was responsible for developing its own business continuity plan to deal with potential risks to their particular service areas.  There would also be a corporate business continuity plan.

·         members discussed the progress in delivering the Internal Audit Operational Plan for 2016/17 given the capacity issues arising from periods of maternity leave within the team covering the current and next financial year resulting in the third revision of the Plan.  The Plan was well underway and the HIA was confident that it would be completed in order for him to provide an annual audit opinion at the end of the financial year

·         with regard to the management of voluntary school funds detailed in the Plan, the HIA explained that in light of the low assurance rating he would be developing new guidance for schools on how to manage funds effectively to be in place by 1 April 2017.  It was agreed that a follow up on the effectiveness of the new guidance in schools be undertaken after approximately six months’ implementation and the findings reported back to the committee.

Members felt the report format was clear, comprehensive and easy to read and asked that future reports to committee also contain the following information (1) Follow up of previous Internal Audit reports – to include a table showing all audits with an action plan that had not been fully completed, and (2) Progress in delivering the Internal Audit Operational Plan 2016/17 – to include audit completion dates.

The Chair urged members to read all internal audit reports circulated to them to identify good practice and borderline cases which may warrant further consideration by the committee.  The HIA added that contact details were included on the reports and he encouraged members to contact the relevant auditor if they wished to discuss the report further.  Councillor Alice Jones welcomed the report and paid tribute to the work of the Internal Audit team in providing a valuable service.

RESOLVED that –

(a)       the report be received and noted;

(b)       the content and format of the report be approved for presentation to future committee meetings subject to the inclusion of (1) a table showing all audits with an action plan not fully completed, and (2) the inclusion of audit completion dates, and

(c)        a follow up report on the effectiveness of the new guidance for schools on how to manage funds effectively be undertaken after approximately six months’ implementation and the findings reported back to the committee.