Agenda item

The Head of Internal Audit to submit a report to update Members on progress made in delivering the 2017/18 Annual Audit Plan and key findings arising from audit assignments completed.

The Head of Internal Audit

(a)  submitted a report (copies of which had previously been circulated to Members) which updated the Committee on progress made in delivery of the 2017/18 Annual Audit Plan and key findings arising from audit assignments completed;

(b)  advised that since the last Committee meeting

·         three reports had been finalised as summarised at Appendix A, Section 2.5 of the report

                                     i.        Financial System Key Controls: This was the annual audit of key controls in financial systems.  Sample testing confirmed 100% compliance with key controls on BACS payments, control account reconciliation, invoice processing and credit notes.  Housing rents were reviewed and it was confirmed that updates to records had been made in a timely manner.  Internal Audit made a recommendation around ensuring a reconciliation between the rent roll and the property records and also recommendations around improving the procedural guidance for council tax and NNDR relief, discounts and exemptions.  Overall, good levels of assurance and minor organisational risk remained.

                                    ii.        Leisure Vision Phase 2: The scope of the Phase 2 project had initially been to procure a design, build, operate and manage model for the Melton Sports and Leisure Village.  A large procurement process took place involving key officers from Legal and Procurement Sections and a project group, including consultants/specialists.  Following dialogue with potential bidders, it was established that the full procurement should not go ahead and instead a contract for the operation of the ongoing facilities was awarded.  The project management and decision making arrangements around the project were reviewed and given a good level of assurance with minor organisational risk overall.

                                   iii.        Waste Contract Procurement: This was the second review of the project management arrangements this year.  Based on the evidence provided of decision making, risk management, issue management and communications, good assurance ratings had been maintained.  The project planning had been strong with timely highlight of any slippage and all recommendations from Internal Audit’s previous report to this Committee had been implemented effectively

·         there remained a number of overdue recommendations, which Internal Audit were monitoring with Management.  It was anticipated that an improved position would be reported at the next meeting of this Committee in June 2018.

(c)  highlighted the update on fraud investigation work.  This was the outcome of the investigation which Internal Audit had been working on over the last year.  Court proceedings had concluded and guilty verdicts were passed in respect of the former officer of this Council and his wife.  The officer was sentenced to twenty months in prison and his wife received a suspended sentence.  This information would be included within the annual fraud report to this Committee in June 2018.  There would also be a further report to this Committee concerning the recovery of monies through this fraud.

The Chair thanked the Head of Internal Audit for her excellent work.

A Member asked why the project management  budget for consultancy support on the Waste Project had to be increased from £99k to £154k.  The Assistant Director for Strategic Planning and Regulatory Services advised that there had been six bidders, leading to more additional work to support rounds of dialogue, assessment and evaluation etc and also due to prudential borrowing and financial advice.  The revised budget would be sufficient to complete the project.

The Member also queried why a meeting which was due to take place in February 2018 (with a software supplier) and which had to be cancelled was rearranged for May 2018.  Could an earlier date not have been agreed?  The Head of Internal Audit advised that the meeting had been cancelled due to adverse weather conditions and the Chief Executive advised that he did not have further details but would look into this.

Another Member referred to Financial Systems Key Controls, asking whether processes had now been implemented to ensure user access was revoked when staff changed roles, left this Council etc.  The Head of Internal Audit confirmed that this would be examined as part of the Cyber Security review.  However, there was a process in place to ensure access rights were updated for leavers.

There being no further comments or questions forthcoming from Members, it was

RESOLVED that the report be noted together with the progress made by the Internal Audit team in delivery of the Audit Plan.