|
Report to: |
Pension Board
|
|
Date of meeting: |
1 June 2021
|
|
By: |
Chief Internal Auditor
|
|
Title: |
Internal Audit Reports and the Internal Audit Strategy for Pensions 2021/22
|
|
Purpose:
|
This report advises the Board of the outcomes of the attached audits and provides the Board with the opportunity to comment on the draft Internal Audit Strategy for Pensions. |
RECOMMENDATIONS
The Board is recommended to:
· note the following internal audit reports:
o Pension Fund Governance 2020/21 (Appendix 1);
o Pension Fund Investments and External Control Assurance 2020/21 (Appendix 2);
o Pension Administration - Information Governance 2020/21 (Appendix 3);
o Internal Audit Briefing Document - Altair Data Transfer (Appendix 4); and
· consider and comment on the 2021/22 Internal Audit Strategy for Pensions (Appendix 5).
1. Background
1.1 The reviews of:
· Pension Fund Governance 2020/21 (Appendix 1);
· Pension Fund Investments and External Control Assurance 2020/21 (Appendix 2); and
· Pension Administration – Information Governance (Appendix 3)
were completed as part of the Internal Audit Strategy for Pensions 2020/21 and provide assurance on the overall effectiveness of their respective systems’ controls.
1.2 As a result of our work on Pension Fund Governance 2020/21, we were able to provide an opinion of Reasonable Assurance over the controls in place. The previous audit, which combined governance and investments, also gave an opinion of Reasonable Assurance. Whilst the opinion is positive, the findings reflect the limitations of a single fund to be able to influence the governance arrangements of the ACCESS Pool. The East Sussex Pension Fund (ESPF) is working with the ACCESS Joint Committee to resolve and obtain assurance in this area.
1.3 Following our work on Pension Fund Investments and External Control Assurance 2020/21, we were able to provide an opinion of Substantial Assurance over the controls in place. This report reflects the improvements made since last year’s combined audit (see item 1.2), in which we gave an opinion of Reasonable Assurance.
1.4 Our audit of Pension Administration – Information Governance 2020/21, was the first time we reviewed this area and we were able to provide an opinion of Reasonable Assurance over the controls in place.
1.5 Where areas of improvement were identified in each of these audits, robust management actions were agreed, together with timescales for their implementation.
1.6 The last of the audits for 2020/21 is Pension Fund Administration - People, Processes and Systems. Our draft report is currently being discussed with management and we hope to be able to issue a final report imminently. Members may recall that this received an audit opinion of minimal assurance last year. Whilst we are not able to confirm this year’s opinion at the moment, we are pleased to report that there has been significant improvement in controls and the revised opinion will reflect this.
1.7 In addition to the planned audits, we reviewed the proposals for the transfer of data to, and testing of, the new instance of the pension administration software, Altair, established as part of the transfer of administration from Orbis to ESCC Finance. Following our work, we provided the project’s Change Advisory Board (CAB) with a paper detailing our findings (Appendix 4), so that they could be considered as part of the CAB’s decision to go live with the new system. We gave no audit opinion, and there were no formal actions arising from this work.
1.8 The Council’s Internal Audit Strategy for Pensions 2021/22 (Appendix 5) sets out the approach Internal Audit takes when planning its assurance on the effectiveness of controls over the ESPF. It sets out the risks inherent in administering a large and complex scheme so that audit resources may be focussed on areas where these risks are highest. The new Strategy reflects the transfer of administrative function, as outlined above.
1.9 Input has been sought from officers responsible for running the Scheme and from the Chairs of both the Pension Board and the Pension Committee and their contributions have been fed into the draft Strategy.
2. Conclusions and Reasons for Recommendation
2.1 The Pension Board is:
· recommended to note the Internal Audit reports; and
· requested to consider and recommend the Internal Audit Strategy for Pensions 2021/22 to the Pension Committee for its approval.
RUSSELL BANKS
Orbis Chief Internal Auditor
Contact Officer: Nigel Chilcott, Audit Manager
Tel No.: 07557 541803
BACKGROUND DOCUMENTS:
None