Agenda item

The Committee considered an update report from the Southern Internal Audit Partnership which set out a clear and transparent articulation of internal audit activity, performance, and outcomes during the eight-month period up to 30 November 2023.

The report had included the status of ‘live’ internal audit reports; an update on progress against the annual audit plan; a summary of internal audit performance, planning and resourcing issues; and a summary of significant issues that would impact on the Chief Internal Auditor’s annual opinion.

Iona Bond of the Southern Internal Audit Partnership presented the report and drew the Committee’s attention to the revised presentation of the table showing Stakeholder Satisfaction Survey Results as requested at the last meeting.

The Committee’s attention was also drawn to the reference to the KPMG review of Performance Monitoring in the table of “live” audit reviews, which had been included in error as all the management actions had been completed.

The Committee noted that since the last report, two audit reviews had been undertaken - on procurement and information governance both of which had concluded with a “reasonable” assurance opinion, with a number of management actions none of which were due at the time the report had been produced.

In relation to the rolling work programme (section 7 of the report), the Committee were informed that all of the scheduled Q.3 work was currently in progress.  The internal auditor had also finalised three further audit reports which would be considered at the next meeting.

In relation to Annex 1 to the report (overdue “high priority” management actions), the internal auditor reported that, since the last Committee meeting, there was only one overdue management action (on budgetary control) that had reached its revised implementation date and to note that the implementation date had moved again. The second overdue recommendation on the payroll budget discrepancy had not yet been followed up because the revised target date had been 30 December 2023.  This would be updated in the next progress report.

In relation to Annex 2 (overdue “low to medium priority” management actions), it was noted that, whilst there had not been any significant changes,  because most of the revised target implementation dates had not yet been, there were two exceptions namely Core Financial Controls - Journals, and Core Financial Controls - General Ledger, each of which had medium priority recommendations where the due dates had slipped for a further two months.  The Internal Auditor emphasised, however, that work was ongoing in respect of these overdue management actions on these individual audit reviews, but they were all integral to the wider work streams associated with the financial recovery plan.

The Internal Auditor noted that, at the last meeting of the Committee, a request had been made to provide additional information on the overdue low and medium priority management actions and explained that this had not yet been addressed partly due to the limited time available between committee meetings.  It was hoped that this information could be provided at the next meeting, and subsequently each year at the March meeting.

During the debate, the following points were raised by the Committee:

·      In response to a question as to how concerned the Committee should be with the number of overdue medium and high priority management actions, and whether these actions would be undertaken soon, the Internal Auditor confirmed that work was ongoing to resolve and implement the management actions.  However, that work was taking longer than expected as much of the work related to key financial systems.

·      Noting the comments of the Internal Auditor as to the number of overdue management actions, and the work that was ongoing to address them it was noted that a number of these actions had revised due dates for 31 December 2023 and the Internal Auditor was asked whether these due dates had been revised further.  The Internal Auditor indicated that this report only included their follow-up work on overdue management actions that fell due before 30 November 2023, and that it was not yet possible to confirm whether the revised target date of 31 December had been achieved.

·      It was noted that the covering report had not been written using the revised report template, as it omitted sections on climate change/ sustainability implications and equality and diversity implications.

·      There should be clearer accountability for implementation of management actions, with identifiable officers responsible for their implementation by the due dates. It would be useful to understand how the due dates were agreed, and whether those due dates were realistic in terms of implementation.

·      In response to a question as to how the audit review of S106 Contributions had provided a significant assurance opinion with minor improvement opportunities, whilst the Committee had previously raised concerns regarding unspent contributions, the Internal Auditor commented that that review had been undertaken by the previous auditors, KPMG in 2022-23. 

Having considered the report, the Committee

RESOLVED: That the progress made against the internal audit plan for 2023-24, as detailed in the report submitted to the Committee be noted.

Reason:

To ensure good governance arrangements and internal control by undertaking an adequate level of audit coverage.