Agenda item

Purpose: To set out the proposed Internal Audit work for the three year period covering 2019/2020 to 2021/2022.

The Committee considered a report (Agenda Item 8) which set out the proposed Internal Audit work for the three year period covering 2019/20 to 2021/22.

The report set out the proposed work programme for Internal Audit over the next three years. In order for an informed decision to be made regarding the work programme this report set out the role of Internal Audit together with supporting information as to how the plan was compiled.

Julie Gilhespey explained that she was required to review the Internal Audit Charter annually. She had drawn on some of the recommendations from the external review of internal audit during this process. The most significant change was clarifying that the Audit Manager should have direct access to both the Chair of the Governance and Ethics Committee as well as the Chief Executive. This was standard practice which needed to be adopted.

The Audit Manager had also made some changes to the Reporting Protocol. Firstly she had removed the requirement for consultation with the Portfolio Holder, this stage never resulted in any changes to the draft report and extended the consultation period by a month. The second change was the removal of the requirement to include Head of Service comments/progress update in the Audit Plan update reports. It was felt that including comments at this stage was not adding anything to the update report. She reassured the Committee that the Portfolio Holder would still receive the final report as per current practice.

Councillor Jeff Brooks noted that the programme was very long. He drew attention to the audit of IR35 (Audit No. 5) which was listed as high risk and stated that unless the Council was utilising a large number of limited company contractors he was not sure why this was the case. Julie Gilhespey accepted Councillor Brooks’s comments but stated that this was a new process which had recently been introduced and it had been agreed that the area should be audited once the process had been imbedded. She stated that as this included schools the number affected might be higher than expected by Members. Councillor Brooks felt that there were other areas that should be deemed more important.

He asked if the Audit Manager was confident that there were sufficient resources available to cover all the audits. Ms Gilhespey stated that Appendix E highlighted than in 2019/20 there were 693 planned audit days and only 672 staff days available. Councillor Brooks stated that the programme should be looked at carefully to ensure that all the audits were necessary. The Audit Manager explained that the audits were programmed on a cyclical basis and high risk areas were scheduled to be audited every five years. This could be extended but would increase this risk level in these areas. The Chairman suggested that if members had concerns about specific audits they should send these to the Audit Manager outside of the meeting.

Councillor Keith Chopping noted that the audit team had been reduced from nine to four employees over the years. They had also been carting a vacancy. He asked the Committee for their comments on the level of resourcing for this important area. Councillor Paul Bryant asked if there was any evidence to support the contention that the team was too small given the high costs of staffing. Julie Gilhespey explained that the external audit of internal audit undertaken by CIPFA had indicated that the team was on the small side for a unitary authority. This was also reflected in benchmarking data.

Andy Walker explained that the service was about to be the subject of a New Ways of Working Review where data, including benchmarking, would be looked at in detail. It would therefore be better to await the outcome of that process. The Committee agreed to this approach.

RESOLVED that the Proposed Audit Plan, Internal Audit Charter and Internal Audit Reporting Protocol be approved.