To consider the Internal Audit work undertaken and the assurance given on the adequacy of internal controls operating in the systems audited for the period December 2014 to February 2015.

44.1           The report of the Policy and Performance Group Manager, circulated at Pages No. 52-91, summarised the work undertaken by the Internal Audit team for the period December 2014 to February 2015.  Members were asked to consider the audit work completed and the assurance given on the adequacy of internal controls operating in the systems audited.

44.2           Members were advised that full details of the work undertaken during the period were attached at Appendix 1 to the report and a list of audits within the 2014/15 Audit Plan and their progress to date could be found at Appendix 2 to the report.  The Policy and Performance Group Manager confirmed that the team was currently on target to achieve the minimum 90% completion of the Audit Plan by the end of the financial year.  It had previously been reported to the Audit Committee that the Council’s Environmental Safety Officer would be seconded to the Internal Audit team to undertake health and safety audits with the findings from the audit formally reported to the Audit Committee.  Unfortunately this had not happened as quickly as anticipated due to the Environmental Safety Officer being involved in a significant health and safety investigation.  The first of the audits, ‘risk assessments including asbestos and legionella’, was now at draft report stage and would be reported to the Audit Committee in June.  The Policy and Performance Group Manager was pleased to advise that no incidents of fraud, corruption, theft or whistleblowing had been reported during the period.  It had been reported to the Audit Committee on 24 September 2014 that there had been a request from Tewkesbury Town Council for its internal audit work to be undertaken by the Borough Council’s Internal Audit Team.  This had been approved by the Corporate Leadership Team and Members were informed that a total of 12 days had been incurred on the audit; this was longer than the estimated 5-7 days as it had taken time for Officers to get to grips with the systems used. The Town Council would be recharged for the full 12 days.

44.3           In terms of the audits which had been completed during the period, Members were advised that an audit had been undertaken on the Repair and Renew grants.  The Memorandum of Understanding between the Council and the Department for Environment, Food and Rural Affairs (Defra) required the Council’s Chief Internal Auditor to give an audit opinion that invoices submitted by the Council were in compliance with the grant scheme.  At the time of the audit, £205,125.22 had been awarded and a sample of applications had been checked, along with the underlying monitoring framework.  The audit confirmed that expenditure had been correctly approved; a record had been maintained of each grant application, the measures applied for, the value and an individual reference number; and a number of pre and post inspections had been carried out greater than the required sample size of 5%.  With regard to invoicing Defra, at the time of the audit quarterly invoices were yet to be raised.  It was a requirement of the scheme for the Council to provide a schedule on the last working day of every quarter and to invoice Defra within 20 working days of the last quarter.  As no expenditure had been incurred in quarter 1, and only £39,000 had been incurred during quarter 2, it had been verbally agreed with Defra that this could be carried forward to the quarter 3 invoice; however, the quarter 3 invoice was yet to be raised.  Defra had confirmed that a revised submission date of 28 February 2015 was acceptable and an invoice had been received for £177,000.  There would be two further submission dates of 31 March and 30 June 2015.  A number of recommendations had been made in order to strengthen the arrangements in relation to the administration of the scheme: terms and conditions should be issued and signed for each grant award; the check against the Business Flood Grant Scheme needed to be evidenced; and post-inspections undertaken needed to be reported within the Defra schedule.

44.4           In terms of the new leisure centre audit, there had been found to be adequate project management procedures in place, a risk register had been in place throughout the project and budget monitoring was also in place.  Furthermore, Officers were satisfied that the procurement process was being followed through a framework agreement with SCAPE, a local authority owned and controlled company.  The Council was currently in the process of developing its information governance framework.  It was acknowledged that the overarching policy was at an early draft stage but an audit had established that the key policies and procedures which supported the framework were in place and they had been reviewed during the audit to ensure that they were robust, up-to-date and relevant.  Recommendations had been made in relation to reviewing and updating policies which were now due for review, developing document retention/destruction policies for service areas where they did not currently exist and developing an information governance training programme for staff and Members.  In accordance with the Freedom of Information Act, the Council had developed a Publication Scheme; this needed to be updated and published in accordance with the Information Commissioner’s model scheme.  With regard to the S106 grants follow-up audit, the process for handling S106 Agreements had been reviewed and updated in line with the previous audit recommendation.  The S106 monitoring module was found to record obligations accurately, however, the data retained did not provide assurance that regular monitoring was being undertaken in respect of identifying the number of properties being built, including those obligations associated with affordable properties.  To assist with this, consideration was now being given to receiving valuation updates from the revenues inspection process.

44.5           Appendix 3 to the report contained a statement of internal audit recommendations.  In terms of particular areas of interest, the Policy and Performance Group Manager indicated that it had been reported at the last Committee that the Council had failed the 2014/15 Public Sector Network (PSN) Code of Compliance as five PSN users had not undergone the Baseline Personnel Security Standard (BPSS) check.  These users had now been checked and the Council was PSN compliant; an item was included later on the Agenda to discuss this further.  In terms of budgetary control, the Finance Team had reviewed the budget scheme of delegation and produced a new handbook for managers which would support the budget control framework for the new financial year.  It was also noted that, based on feedback from local businesses, a proposal had been put forward to the Department of Business, Innovation and Skills (BIS) to use the remaining flooded business support grant money in other ways in order to build resilience in the flood impacted areas of the Borough.  Approval had been obtained in January which would allow the remaining £225,000 to be spent more flexibly.  In respect of flood alleviation grants, there had previously been a limited internal audit opinion in relation to Government grants under £220,000 as there were no formal arrangements in place.  An agreement between Gloucestershire County Council and Tewkesbury Borough Council had been drafted and other District Councils were now looking to put a formal agreement in place.  The tree inspections audit had recommended that a database of inspections should be established and maintained and Members were informed that days had been allocated within the 2015/16 Internal Audit Plan to follow-up the implementation of the database and to give assurance that inspections were being undertaken in accordance with the tree management policy.  It was noted that the recommendations in relation to the food control audit were outstanding as a result of the Environmental Health review and would be addressed once the new staff structure was in place.  Finally, a number of recommendations had been made in relation to the garden waste database.  This would transfer from Environmental and Housing Services to Customer Services as part of the Ubico transfer and would be looked at as part of the current Customer Services review.  A number of days had been allocated in the 2015/16 Internal Audit Plan to follow-up this audit.

44.6           With regard to S106 Agreements, a Member sought clarification as to when the money was payable and was advised that this would be dependent on the particular Agreement as they all had different trigger points ranging from the first spade going into the ground to the last house being built.  In response to a query regarding the garden waste service moving to Customer Services, the Environmental and Housing Services Group Manager clarified that one full-time post would remain within Tewkesbury Borough Council to deal with garden waste administration; all other staff within the department would transfer to Ubico. 75% of the garden waste role would be within Customer Services, the remaining 25% related to invoicing.  With regard to the information governance audit and the Freedom of Information Act, a Member went on to question whether there was potential for using the Firmstep Platform.  The Policy and Performance Group Manager advised that Firmstep was a piece of software for local authorities; currently all Freedom of Information requests were logged and monitored manually whereas the software may be able to automate the process.

44.7           A Member was surprised that only half of the Repair and Renew grant funding had been spent and the Environmental and Housing Services Group Manager explained that only £205,125 had been awarded at the time of the audit, however, over £400,000 had now been claimed.  Officers from Tewkesbury Borough Council and Gloucestershire Rural Community Council (GRCC) had done a huge amount of work with residents to ensure that they claimed as much as possible.

44.8           Having considered the information provided, it was

RESOLVED          That the Internal Audit Plan Monitoring Report be NOTED.