Agenda item

1.1          The Head of Finance introduced the item.  The Internal Audit was an independent, objective assurance and consulting activity, designed to add value and improve an organisation’s operations. It helped the organisation accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes.

1.2          P Connolly, Principal Auditor was introduced and went through the report. This report had been prepared in accordance with the Public Sector Internal Audit Standards. It gave an overall opinion on the adequacy and effectiveness of the City Council’s internal controls during 2023/24, which was Reasonable - There is a general sound system of governance, risk management and control in place. Some issues, non-compliance or scope for improvement were identified which may put at risk the achievement of objectives in the area audited. The overall opinion was based on the approved Internal Audit plan 2023/24 (May 2023).

1.3          The report also highlighted the performance of the Internal Audit Section and whether its key targets in the year were met. It was noted that 79% of the approved audit plan was completed for the year.

Comments of Committee Members:

1.4          Dr Barry complemented the team on their performance and referred to 96% of Management Actions implemented, but expressed concern about the caveat that this could not be checked due to resource availability.  The Head of Finance advised that this approach was completed by officers as a self-checking process.

1.5          Dr Barry asked whether the directorate was overseeing the self-checking process. The Head of Finance suggested that he could remind the Directors and Heads of Service of this step if the Committee wanted to make that statement to strengthen the endorsement.

1.6          The Chair echoed Dr Barrys comments.

1.7          Mr Reed congratulated the Audit team and referred to the adverse reports on page 111, and asked if the Committee could invite someone from the Private Sector Housing and Asylum Seekers Imprest Account to provide an update on these matters.  L Rees, the Principal Auditor advised that these two recommendations were only completed in March and might therefore be called into July’s Committee.

1.8          The Chair advised that he would like to see the outcome of the report first and then consider calling them back at a future meeting.

1.9          The Chair queried the term ‘consultancy’ referred to tin the report.

1.10       The Head of Finance advised that ‘consultancy’ referred to a a service area that was undertaking changes to structure.  Audit was providing support and guidance to these areas whilst they were in a state of development to support them to make the changes.

1.11       The Chair considered that if the service areas were in the audit plan, then they should be dealt with in accordance with the audit principles and the Committee should be able to consider the outcome as part of the system of assurance.  The Head of Finance noted this point and confirmed that they would discuss this with the Audit Manager and report back to the Committee the differences in the next regular update of the audit plan.  L Rees, Principal Auditor also advised that it was a position statement and there was a list of recommendations provided by the Audit Team at the end of the report.

1.12       Councillor Jordan was also concerned that those on the high-risk register included social care, education, and finance in relation to the consultancy type reviews.

1.13       Councillor Horton request a list be provided to the Committee of those areas where consultancy type reviews took place.  L Rees, Principal Auditor advised that Control Risk Self-Assessments (CRSA) were sent to adult and children’s residential homes children and certain schools.  It was a self-assessment, and they had a list of controls expected to be in place. There was full/partial/no compliance or Not Applicable and there were also mitigating circumstances in place.  If the control was not in place at all, critical, significant, and moderate risks were identified. 

1.14       The Chair thanked the Principal Auditor for clarity and asked if the Head of Finance could take this back and provide the Committee with an understanding of how these were dealt with going forward and how to deal with this as a Committee.

Recommendation:

1.15       That the Annual Internal Audit Report 2023/24 and overall Audit Opinion be noted and endorsed by the Council’s Governance and Audit Committee

1.16       That the Head of Finance provide a reminder to the Directorate concerning the importance of overseeing the implementation of self-checking on improvement actions identified. 

1.17       That a report would be provided to the Governance and Audit Committee to ensure the Committee was fully advised on any of the changes within the Audit Plan including the consultancy approach taken for services in a state of development.

1.18       Adverse assessments noted in the report would be called to a future Committee meeting, but this would be following the outcome of the follow-up report.