To receive the report of the Executive Director of Finance, Resources & Customer Services summarising the work that the Internal Audit and Risk Management Service (ARMS) has completed for the period 1 April 2017 to 28 February 2017.
RECEIVED the report of the Executive Director of Finance, Resources & Customer Services (No.156) summarising the work of the Internal Audit & Risk Management Service for the period between 1 April 2017 and 28 February 2018.
1. Chart 1, highlighted at 3.4 (page 26 of the report) detailed progress against the internal audit plan for 2017/18. The team had commenced 72 assignments (99% of the current plan) of which 36 (49%) have been completed. Since the audit plan was approved by the Committee in March 2017, 18 assignments had been added to the plan and six had been deferred or cancelled, as detailed in Appendix 2 (page 37) of the report.
2. Table 1 (page 27) of the report, highlights 36 completed assignments.
3. Detailed at 3.7 (page 28) of the report, 78 actions for improvement had been agreed with managers, including 6 relating to high risk findings.
4. Since the last report, 15 reports had been finalised, three of which were given Limited assurance. Further details of the three limited assurance audits can be found at 3.9 – 3.11 (pages 28-29) of the report.
5. Managers’ progress with implementing internal audit recommendations are summarised in Chart 3 (page 30) of the report. Overall, 64% of high priority recommendations and 50% of medium risk priority recommendations had been fully implemented. This was an improvement since the last audit. The chart at 3.14 (page 30) of the report, details what the different departments are achieving.
6. Counter fraud results are detailed at Table 2 (page 30) and Table 3 (page 31) of the report. Table 2 shows the overall achievements of the team and Table 3 highlights the team’s savings analysis. There is a more detailed summary of the Counter Fraud team’s activities detailed at Appendix 3 (pages 38-39) of the report.
7. Table 4 (page 32) of the report, highlights the team’s Quality Assurance Measures detailing the targets set and the actual average figures achieved to date. By the End of March 2018, 95% of assignments would be at draft report stage.
8. Appendix 1 (pages 35-36) provides a summary of the 2017/18 Audit Plan status as at 28 February 2018. The right hand column of the table highlighted whether the team were on target. Most of the audits were green which meant that they were at the stage the team wanted them to be, some are amber and a few are red meaning the team were a couple of months behind.
9. The red risks were as follows:
a. FRCS – Budgetary control – Audit of looking into the council’s processes for actioning savings targets. Unable to programme meeting dates in the diaries of key managers.
b. FRCS – CAM (phase 1) – Continuous audit monitoring audit. The team were still trying to clear some of the exceptions identified.
c. FRCS – Pensions – Some problems regarding assistance from the pension team regarding testing. Should be resolved in a few days.
d. R & E – Highway Services
10.The following issues raised in response to the report:
a. The Chair was pleased with the welcome progress made with implementing management actions and the £1.9m savings made by the counter fraud team. This was an improvement compared to past years.
b. Councillor Dogan asked how the team set their annual targets and what they based their calculations on. Christine Webster clarified that the target of 75 council housing recoveries was based on what the team had achieved in the past with a full team. The target of 75 recoveries was achieved with only 3 investigators in the past and felt that we could do the same this year. Unfortunately, due to Grenfell, the neighbourhood team have been unable to provide the referrals to the team.
AGREED to note the progress made in delivering the Audit and Risk Management Service’s 2017/18 work plan and the outcomes achieved to date and managers’ progress with the implementation of internal audit recommendations.