Agenda item

To consider the Internal Audit Annual Report 2014/15 and the assurance from the work undertaken during the year on the level of internal control within the systems audited during the year. 

12.1           Attention was drawn to the report of the Corporate Services Group Manager, circulated at Pages No. 89-94, which provided Members with a summary of the internal audit work undertaken for the financial year 1 April 2014 to 31 March 2015, together with an opinion on the overall adequacy and effectiveness of the organisation’s control environment.  Members were asked to consider the report and the assurance that, overall, there was a satisfactory level of assurance in relation to the effectiveness of the Council’s framework of governance, risk management and control. 

12.2           Members were advised that the annual audit plan was compiled using a risk-based approach and was informed by governance issues and work relevant to the production of the Annual Governance Statement; work on fundamental financial systems; work of a service-based nature; corporate improvement work; follow-up work; and consultancy and advice.  This approach resulted in a comprehensive range of audits that were undertaken over the course of the year to support the overall opinion on the control environment.  In compliance with the Public Sector Internal Audit Standards (PSIAS), regular monitoring reports of internal audit activity were presented to the Audit Committee on a quarterly basis.  A list of the audit work undertaken in the year was set out at Page No. 91, Paragraph 2.2 of the report.  There was one audit outstanding from the 2014/15 Plan in relation to electoral registration, as had been reported earlier in the meeting, and this work would be accommodated within the 2015/16 Plan.  As well as internal work, the team also provided an internal audit to Tewkesbury Town Council.  This arrangement had commenced part way through 2014/15 and days had been formally allocated within the 2015/16 Plan to carry out that work on an ongoing basis.  In addition, the Internal Audit team also undertook a variety of corporate improvement work initiatives.  The Audit Plan contained an allocation of days for that type of work and the Corporate Management Team could request that the Internal Audit team assist with areas of work which needed to be moved forward, for example, the Revenues and Benefits improvement programme; work around the Local Government Transparency Code; setting up the Repair and Renew grants; the ‘Selling to the Council’ guide; and setting up the methodology for the health and safety audit.  The team was also represented on key corporate groups such as the Corporate Governance Group and the ‘Keep Safe, Stay Healthy’ Group.

12.3           Members were advised that 49 audit opinions had been given during the year, as set out at Page No. 92, Paragraph 3.2.  There were two limited opinions and one unsatisfactory opinion issued throughout the year relating to safeguarding, risk assessments and ICT asset inventory respectively.  The Corporate Services Group Manager explained that Officers worked in a complex environment with a number of schemes, policies and procedures which meant that there would always be areas where assurance was limited or unsatisfactory; the important part was recognising those areas and taking action to make improvements.  Management of internal audit was overseen by the Corporate Services Group Manager and delivery of the Audit Plan was carried out by two full-time employees.  One employee was currently on maternity leave and the position had been covered during the year through a combination of an Internal Audit contractor and a secondment from another service area.  During 2015/16, consideration would be given to the independence of managing the Internal Audit team given the Group Manager’s wider remit of Corporate Services.

12.4           The performance monitoring information for achievement against the Audit Plan was based on the number of completed audits vs. the number of planned audits and Members were advised that the outturn for the 12 month period was 92.31%.  A client survey was issued at the end of each audit which had confirmed that there was a ‘good’ level of client satisfaction.  The team had not started work on the 2015/16 Audit Plan which had been agreed at the March Committee meeting and included the complaints framework; tree inspections; key finance systems; economic development; leisure centre; Cascades; Disabled Facilities Grants; and Ubico.  In terms of corporate improvement work, potential activities identified included: review of the Council’s fraud arrangements; ICT asset register; Revenues and Benefits policies; and the Customer Services improvement programme.  Based upon the work undertaken during the year, Internal Audit could provide reasonable assurance that, overall, there was generally a satisfactory level of control in relation to the effectiveness of the Council’s governance, risk management and control environment. 

12.5           It was

RESOLVED          That the internal audit annual report be NOTED.