Agenda item

Internal Audit Report

To consider the report of the Director of Resources and associated reports from the Internal Auditors, BDO, at 7a to 7h, (copies enclosed).                                                                                            


The Committeeconsidered thereport ofthe Director ofResourcesandassociated Internal Audit reports from BDO LLP, attached on the agenda at 7a to 7h, Progress Report; Follow-up of Recommendations; Policy Review; Strategic Performance – Community; Main Financial Systems; IT Strategy and Transformation; Management of Property and Draft Internal Audit Annual Plan 2022/2023 and Strategic Plan 2022/2025.














The Chairman introduced the reports and deferred to the Internal Audit Partner to present the detail.  He advised the Committee that he would present the eight reports in two tranches, dealing with 7a), 7b) and 7h) first and any questions arising, followed by the five main audit reports.  It was noted that the Progress report provided assurance to Members that overall progress was generally good, resulting in a positive year end audit opinion from the Head of Internal Audit.  It also highlighted that there were four further reports to be received by the Committee scheduled for June 2022.


The Follow-up of Recommendations report covered both completed and outstanding recommendations.  He drew Members’ attention to the high priority recommendation relating to Safeguarding which had now been completed, resulting in a lower risk category.  The overdue recommendations included the Environmental Strategy which had been closed as this would now be incorporated under the upcoming review of the Climate Change Strategy. The Draft Internal Audit Annual Plan 2022/2023 and Strategic Plan 2022/2025 for next year followed the normal format linked to the audit of risks and had been discussed with Officers.  It represented a balanced programme of work to include:- reviewing Finance areas, the strategy around the Strategic Theme ‘Place’, Flood Management, Safeguarding together with the Local Development Plan and Climate Change Strategy.


In response to issues raised Officers provided the following information:-


·        That delays in completion of recommendations in respect of Flood Management related to the number of outstanding actions on the part of other agencies involved in the process.


·        That the outstanding recommendation in respect of affordable housing and the issue with sign-off of the 2021/22 Housing Service Business Plan was due to a delay in collating the information on affordable housing.  This was now underway and on target for April 2022.


·        That information regarding the difference between the two forms used within the Safeguarding process would be circulated to Committee Members.  It was further noted that the Safeguarding recommendation, whilst recorded in red to denote the priority status, was now satisfactorily complete, with both forms in place, and would subsequently be allocated a lower priority.


·        That all Councils submit a Delta report on affordable housing in April each year to Central Government.  In addition Affordable Housing statistics were submitted quarterly to the Corporate Leadership Team.


·        That the recommendation around the Strategic Housing Board would remain open subject to issue of a full schedule of future meetings.

The Head of Internal Audit then presented the five audit reports.  The Policy Review audit had attained an assurance level of substantial on design and moderate on effectiveness, with good controls in place.  It was noted there was no dedicated staff member to monitor this area, therefore, it was up to each individual service area to maintain records.  This structure would be reviewed going forward for efficacy.


The level of assurance on Strategy Performance and Community was substantial on design and moderate on effectiveness, with good partnership arrangements in place. It was noted that more detailed action plans were required and that these would be monitored by the Performance, Governance and Audit Committee.  The Main Financial Systems attained an assurance level of substantial on design and moderate on effectiveness, a positive report with good controls in place in this area. The IT Strategy and Transformation was deemed moderate on both design and effectiveness.  It was recommended by BDO that the IT Strategy in place needed more detail as to how it linked to the Corporate Strategy and more evidence on monitoring of corporate projects.


The final audit considered was Management of Property with an assurance level of moderate on both design and effectiveness.  It was recommended that more formal policies and procedures be implemented to monitor repairs and make best use of both assets and debt recovery.  It was noted that an Action Plan was now in place to address the system issues identified.  A discussion then ensued around the Asset Register and the former Asset Management Working Group.  Councillor Fluker proposed that the Asset Management Working Group be re-instated by way of a report from the Head of Paid Service to Council, and this was seconded by Councillor Fleming.


In response to issues raised Officers provided the following information:-


  • That in order to mitigate for vacant posts the Service Plan Database would highlight any/all missing data which ensured all areas were updated accordingly.


  • That the former Asset Management Working Group had been disbanded as a result of duplication of remits between it and the existing Corporate Projects Working Group.  Should Members wish to re-instate this, Officers would action accordingly via a report to Council.


  • That Channel Shift had exceeded its target and been reported to previous meetings under the Balance Scorecard Exceptions report.  Channel Shift  statistics would be circulated to Committee Members.


There being no further discussion the Chairman put the previously seconded recommendations, together with the duly seconded proposal from Councillor A S Fluker regarding the reinstatement of the Asset Management Working Group,

to the Committee and they were agreed by assent


RESOLVED that the Committeeconsidered,commented, and approved the following:


(i)               InternalAuditProgress ReportNovember 2021 at  7a;

(ii)              Follow-upof RecommendationsReport- November2021-7b;

(iii)            PolicyReviewReportJanuary20227c;

(iv)            StrategicPerformance-CommunityReportJanuary20227d;

(v)             MainFinancial Systems ReportJanuary20227e;

(vi)            ITStrategyandTransformationReport January 20227f;

(vii)          ManagementofPropertyReport January20227g;

(viii)         Draft InternalAuditPlan2022/2023 and StrategicPlan 2022/20257h;

(ix)            That the Head of Paid Service present a report to Council to re-instate the Asset Management Working Group.


Supporting documents: