Agenda item

Purpose: To update the Committee on the outcome of Internal Audit work carried out during quarters one and two of 2018-19.

The Committee considered a report (Agenda Item 7) which updated on the outcome of Internal Audit work carried out during quarters one and two of 2018/19.

The report concluded that no significant/fundamental weaknesses had been identified in the Council’s internal control framework through the work carried out by Internal Audit during the first two quarters of 2018/19. Progress against the plan was slow during the second quarter due to a Senior Auditor post becoming vacant, and also because there was unplanned work that Internal Audit was requested to undertake which needed to be prioritised over planned work.

Councillor Keith Chopping enquired upon whether the team was now fully staffed. Julie Gillhespey advised that an experiences Senior Auditor was appointed in mid-September.

Councillor James Cole asked whether the team was adequately resourced. Julie Gillhespey expressed the view that she would prefer to have one more member of staff.

Councillor Anthony Pick asked how the weak result of a school audit would be followed up. Julie Gillhespey advised that there would be a follow up in six months, as with the systems audit. Geoff Mayes asked whether the weak audit was due to finances. Julie Gillhespey advised that it was due to weak financial governance.

Councillor Paul Bryant asked whether academies were audited by the Council, Julie Gillhespey advised that they were not.

Councillor James Cole sought more information on procurement cards. Julie Gillhespey advised that a ‘weak’ result was identified because services were not complying with the financial controls. A range of recommendations would be taken forward. It was likely that staff within the services did not understand the requirements, rather than there being deliberate non-compliance. Individual findings had been issued to services. Councillor Chopping requested a further update on the matter at the next meeting in February 2019.

Andy Walker offered reassurance that the Finance and Governance officer group were aware of the situation and would consider withdrawal of the procurement card as a sanction. It was hoped the situation could be resolved through training.

Councillor Beck requested an update regarding the modelling of the Adult Social Care budget. Julie Gillhespey advised that the Chief Executive was authoring a forthcoming report on the matter. Councillor Graham Bridgman, Executive Member for Adult Social Care, advised the Committee that the process was ongoing to correct the modelling. It was known how the modelling error was caused, but not why there had been omissions form the model in the first place. Some elements of the forecast overspend in Adult Social Care could not have been predicted. The new modelling regime should be an improvement.

Councillor Pick asked what degree of risk the council was under through the procurement card issue. Julie Gillhespey advised that the cards had a transaction and monthly spend limit. Around £90k was spent per year via the cards. The primary risk was reputational.

In relation to the audit for contract letting which came out as weak, Councillor Cole sought assurance that it would be revisited following the change to the Council’s Rules of Procedure. Julie Gillhespey advised that it was planned to be audited either next year or the year after (this was checked after the meeting and it is included in the Audit Plan for 2020/21). Julie Gillhespey made the observation that for the audits where the processes were devolved to services, there ended up being quite a number of people being involved in the processes. This resulted in the audits identifying varying degrees of compliance, and therefore there was a higher probability that the overall opinion of the reports would come out as weak.

RESOLVED that the content of the report be noted.