Agenda item

9.1       Nigel Chilcott (NC), Audit Manager, introduced the report which provides an update on the three audits completed in the last quarter and outlines the Internal Audit Strategy and Plan for 2021/22. It was clarified that the Internal Audit and Counter Fraud Team will remain part of Orbis.

9.2       The audits completed in the last three months have all received an opinion of substantial or reasonable assurance. The report on Pension Fund Administration People, Processes and Systems audit is being finalised and is likely to receive an opinion of reasonable assurance, which is a significant improvement on the previous minimal assurance opinion a year ago.

9.3       DP commented that there appeared to be an inconsistency in the audit outcome of the Pension Fund Governance audit in comparison with the other audit which received reasonable assurance. SK explained that although there were not many findings in the audit, the main issue was with the governance manual for the ACCESS Pool. Danny Simpson (DS), Principal Auditor, added that whilst this is largely outside the Fund’s control it was identified as a fundamental issue and a medium risk. Therefore, the outcome of the audit was reasonable assurance. The ACCESS Pool governance arrangements will be reviewed as part of this year’s audit plan.

9.4       TD asked if the target date of 30 October 2021 (Ref 1, page 114 of the report) is realistic in resolving this issue. SK outlined that there is a project taking place, led by West Sussex County Council with the ten other Funds to address the governance manual for the ACCESS Pool. The findings of this project will be presented to the next Joint Committee meeting in July.  It is hoped that on this basis October is a realistic target to resolve this issue.

9.5       DS outlined the contents of the Internal Audit Strategy and Plan for 2021/22. This was written following consultation with the Pension Board and the Pension Committee as well as key officers. There is no significant change in the approach to audits and the plan has 100 audit days allocated to it. The previous work on information governance in the plan will be replaced by audit work on application controls for the new Altair system.

9.6       The Pension Board discussed whether 100 audit days were still needed following the significant improvement in audit outcomes. DS commented that there is sufficient time allocated to carry out all the audit work and to see that the progress made is being sustained. NC added that the increase in audit days was previously agreed with the Chair of the Pension Committee in response to lower audit opinions last year, but is happy to review the amount of days in consultation with the Board and Committee.

9.7       Councillor Gerrard Fox (GF), Chair of the Pension Committee, thanked officers for all their hard work and the improvements that had been made. He would be happy to discuss the amount of audit time with the Pension Committee, but due to the amount of change and the legacy issues that have been dealt with, he would prefer to keep the amount of audit time elevated and take a cautious approach. The Chair of the Pension Board agreed that it is better to have the number of audit days in the plan and then review once the Pension Administration Team is fully resourced.

9.8       The Board RESOLVED to:

1)    Note the outcome of the audits and the updates; and

2)    Recommend the Pension Committee approve the Internal Audit Strategy and Plan for 2021/22.