Agenda item

Report by the Chief Internal Auditor.

7.1       The Chief Internal Auditor introduced the report. The report is in a similar format to previous years which includes a summary of the internal audit work carried out during the year and an overall Internal Audit opinion. The Chief Internal Auditor confirmed that he is able to give an overall opinion of reasonable assurance. Section 3.2 of the Internal Audit Annual report gives an explanation of how the overall opinion is reached, and section 4 outlines the information used as a basis for the overall audit opinion. Section 5 of the Annual report provides a summary of key internal audit issues including details of the audits that have received an opinion of partial assurance and an update on anti-fraud and corruption work. There were twelve audits that were still in progress at end of year, and the outcome of these audits will be reported in the following quarter (quarter 1 of 2019/20).

7.2       The Annual report also contains details of the amendments made to the Audit Plan during the year, which have already been reported to the Committee. The final sections of the report provide information on the Internal Audit performance over the year against the targets and standards that have been set and a summary of audits undertaken during 2018/19 (appendix B). Annex B of the report provides details of the Audits completed in quarter 4 of 2018/19.

7.3       It was clarified that the terms ‘audit’ and ‘review’ are used interchangeably in the report and there is no difference between them. In the context where management actions are agreed, an action is an individual activity that has to be carried out as a result of a review to improve the control environment. Any high risk actions will be tracked and the Internal Audit Team will seek written confirmation that those actions have been completed.

Quarter 4, Audit Opinions

7.4       The Committee discussed the audits that were completed during quarter 4, and those that received a partial assurance opinion. The Committee made the following comments and points for clarification.

• Staff travel and expenses. The audit summary describes the areas that were audited and the key areas for improvement. In particular, the outcomes of the audit highlighted the authorisation of claim forms and the rejection of claims where forms were not signed or did not have the right supporting information.
• Home to School Transport. It was confirmed that a process for checking that valid insurance is held by operators is now in place. There was no indication that valid insurance was not in place, but the evidence that checks were being made needed to be recorded appropriately.
• SAP Upgrade. It was confirmed that a formal upgrade procedure sign-off was put in place before the upgrade was undertaken. This was identified early on in the project and was rectified as part of the project. There was no suggestion that the upgrade was not going to be signed-off by the Project Board, and there was a check point milestone on the project plan. It was more an issue of what the sign-off looked like (i.e. what documentation was produced to formally record the sign-off) than there being no procedure in place.
• Academy Schools. It was confirmed that the Internal Audit Team are not involved in the auditing of academy schools, which are not maintained by the Council.

7.5       The Committee RESOLVED:

1) To note report;

2) That there were no significant control issues that need to be included in the Council’s Annual Governance Statement arising from the report; and

3) That the Council’s system for internal audit has proved effective during 2018/19.