Agenda item

Internal Audit Annual Assurance Report 2017/18

To note the Head of Audit and Risk Management’s Annual Report setting out the Head of Internal Audit’s Opinion for 2017/18.

Minutes:

Sally Hendrick, Head of Audit and Risk Management attended the meeting to present the Committee with her annual internal audit opinion for 2017/18 in the order to comply with the Public Sector Internal Audit Standards.  It was noted that this was timed to inform the review of the Annual Governance Statement (AGS).

 

The Head of Audit and Risk Management advised the Committee that she was able to provide reasonable assurance that there is a sound system of control in place subject to some significant control weaknesses as described in section 5.3 of the agenda report including some general weakening in financial controls across the Council.

 

During 2017/18 there had been some weakening in financial control which had not been raised before. This was down to a number of reasons including issues around the transaction processing of creditor payments and debtor receipts as well as a result of the transformation process. The Committee were advised this was due to issues with staff sickness that had  affected processing as well as the  reduction in the level of support in departments before self- service tools are made available to staff.

 

The Head of Audit and Risk Management had also been concerned about the reduction in the amount of monitoring of key performance indicators (KPIs) in Finance which were an important measure to control and assess what was happening. 

 

Arising from the discussion the following points were made:

  • It was explained that an internal audit provided opinions on controls and the control environment, not just financial control.  It also provided opinions on risk management and governance. The External Auditor assessed if financial figures in the financial statements were true and fair but did have sight of all internal audit reports.
  • Although the definitions of assurance level were contained within the report it was noted that the use of the word ‘significant’ was confusing as both an adjective describing severity of issues and a positive level of assurance.  The Head of Audit and Risk Management agreed to try to use an alternative descriptor going forwards.
  • It was clarified that an opinion was given based on the level of assurance and that if an area has no assurance level, the auditor was not certain if things were happening properly therefore would have ‘no opinion’. If an area had limited assurance level then there were significant issues putting the objectives of that area at risk.  However the Committee were advised that most audits were assessed at a satisfactory assurance level. 
  • The Committee were updated that work was ongoing to review the Council’s business continuity and disaster recovery plans to reflect changes in working practices, the office move to Time Square and that the Strategic Risk Management Group would oversee this.  To support this process the Chief Officer for ICT would be taking a paper to CMT in late summer. 
  • In response to concerns raised by the Committee regarding the absence of improvement in the Construction and Maintenance area highlighted in the last three audits carried out over 18 months they were advised that no further audit work would be undertaken in order to allow management to address the issues raised.  The Head of Audit and Risk Management agreed to carry out a review to provide an update on their progress. The Committee reflected that if no improvement was found, the Governance and Audit Committee would ask the Director to explain.
  • The Head of Audit and Risk Management advised that there was also no follow up planned for the LED lights area as the open book contract had been audited and identified some issues resulting in a limited assurance level.  A good relationship existed with Ringway and they had already addressed the points raised therefore no further audit work would have been useful as the chief officer and heads of service monitoring the contract  would be responsible for taking issues forward. 
  • In response to a question on how the Committee should proceed in respect to concerns around weakening financial control, the Head of Audit and Risk Management advised that the appropriate course of action would be for the Committee to raise this with the Borough Treasurer.

 

RESOLVED  that the Head of Audit and Risk Management’s Annual Report setting out the Head of Internal Audit’s Opinion for 2017/18 be noted.

Supporting documents:

 

Contact Information

Democratic services

Email: committee@bracknell-forest.gov.uk