Agenda item

Purpose: To provide an opinion on the effectiveness of the Council's internal control framework.

The Committee considered a report (Agenda Item 6) which provided an update on the outcome of internal audit work carried out during the second half of 2016/17.

The report met the requirement, set out in the Public Sector Internal Audit Standards as adapted by CIPFA’s “Local Government Application Note”, for the Chief Internal Auditor to present annually an opinion of the Council’s Internal Control Framework.

Ian Priestley referred Members to paragraph 5.3 of the report. This provided detail of an audit that was rated as weak – Section 17 Support in Children and Family Services. The report outlined the concerns of Internal Audit, i.e. that due to the lack of an up to date Policy and guidance, inconsistencies were found with how provisions were being made, recorded and reviewed. There were also inconsistencies with the budget codes used to record expenditure for this purpose.

Ian Priestley felt that the response from the Head of Children and Family Services, also contained within the report, was sensible. This stated that following a period of time in which there had been significant structural and financial changes, and to then allow time to fully embed these changes, a greater level of assurance had been gained and priority was being given to address all the issues raised in the audit. A re-profiling of the S17 budgets had already been undertaken. Julie Gillhespey added that follow up work on this audit was ongoing.

Councillor Anthony Pick stated his contentment with the comments of the Head of Children and Family Services.

Councillor James Cole queried whether the Committee was able to question/be informed of when the up to date Policy had been implemented. Sarah Clarke explained that the report was to note, but the Committee was entitled to challenge the outcome of internal audit work. Councillor Quentin Webb added that the Overview and Scrutiny Management Commission had the role of investigating in more detail particular areas of difficulty. The Governance and Ethics Committee needed to be satisfied that systems/processes were in place and working correctly rather then looking at the detail of the Council’s policies.

Councillor Cole made reference to Appendix A – current audit work. He questioned the time being taken in some cases to complete audit work with a current piece of work dating back to 2014/15 and others back to 2015/16. Ian Priestley explained that the resources of the audit team had shrunk over recent years. He added that non-planned additions to the work programme were also a factor and a significant amount of Officer time could be taken to conduct detailed investigations. Councillor Cole therefore highlighted the importance of preventing any further reductions to the audit team.

Councillor Paul Bryant added his concerns that some audit work dated back to 2014/15 and 2015/16. He felt it would be useful to include a conclusion date where possible. Julie Gillhespey explained that the timetabling of work was not always in the team’s control. For example, audit work would be postponed in the event that a service area was undergoing a review. However, the audit work was still valid and would be completed when possible. Julie Gillhespey added that when the work was conducted after a period of time had elapsed, any new guidance/the latest position of the service would be taken into account.

Councillor Cole suggested that delays were also encountered in cases where it took time to collate/for all necessary information to be provided to Auditors. Julie Gillhespey confirmed this could be the case and added that other priority work could take precedence during this time resulting in further delays in some cases.

Julie Gillhespey felt it would be sensible to state in the document the actual start date of audit work to better reflect the position.

Councillor Steve Ardagh-Walter felt it would be useful to schedule follow up audits of particular documents etc in a set time period. It was noted that this took place when necessary.

Councillor Quentin Webb recalled that a lengthier report had been provided in the past, but stated that he was content with the current report layout. Ian Pennington offered to share alternative ways of presenting audit information with Ian Priestley and his team. They would discuss that further outside of the meeting. Ian Pennington added his view that the Committee could request updates on progress in some areas of work via the Audit team and this could then be shared with Members. Regarding delays in obtaining information, Ian Pennington explained that when he worked in Internal Audit, he had similar difficulties with obtaining information for audit work and suggested that the Committee and Andy Walker could emphasise the requirement for services to provide the information promptly.

Jane Langford queried whether audit work was weighted depending on the area in question/its importance and whether this influenced timeframes. Ian Priestley confirmed that weighting was a consideration in terms of the importance given to and frequency of audits and this was detailed in the separate Audit Plan document.

In summary, Ian Priestley gave the view that the Council’s Internal Audit Control Framework was performing well despite the challenges faced by the Council in terms of reduced resources.

RESOLVED that:

·         the report be noted.

·         Ian Pennington and Ian Priestley would discuss alternative ways of presenting audit information.