The Audit Manager presented a report seeking the comments of the Audit and Governance Committee on the draft Internal Audit Plan 2013/2014. The Audit Plan was based on a number of factors, the main influences being the Councils Change Programme, together with the Corporate and Directorate Risk Registers. The Plan was designed to provide the Audit and Governance Committee with assurance that the Councils framework of internal control was adequate and effective and thereby supported the Committees review of the Annual Governance Statement.
Consultation on the Plan was ongoing and had included the Chief Executive, Directors of Neighbourhood and Communities and Wellbeing, Care and Learning, Heads of Service at relevant management team meetings, the Deputy Director of Resources and the Performance Manager. Once the consultation exercise had been completed a final version of the Plan, incorporating any revisions considered appropriate, would be brought back to the Audit and Governance Committee for formal approval. Progress against the Plan would then be reported to Members by the Audit Manager throughout the financial year.
From 2013/2014, increased focus would be given to internal audit work supporting the Councils Change Programme, which set out how the Council would look in 2018.
The proposed annual Internal Audit Plan for 2013/2014 was detailed in Appendix 1 to the submitted report. It set out how internal audit resources would be deployed between a number of internal control compliance reviews, counter fraud and financial systems. The Council faced significant financial challenges in the years ahead and would lose just under £73 million from its budget over a period of five years. As a result, the Council had devised an extensive series of efficiency savings and budget and service reductions. The draft Audit Plan included a category of work that was specifically linked to supporting the Change Programme, in order to support the Council in meeting the financial challenges.
The Audit Plan was flexible to enable a response to any management requests, changes in priorities or new and emerging risks that occurred throughout the year.
As the Councils internal audit service was provided by a shared service arrangement, a service agreement had been documented between the two Councils and included a number of performance measures. It was proposed that, for 2013/2014 onwards, additional performance measures would be introduced and monitored to ensure that audits were completed on time. Progress against the performance measures would be provided to the Audit and Governance Committee throughout the financial year.
In relation to the proposed Counter Fraud audits it was queried why an external firm had been used to identify duplicate payments made. The Deputy Director of Resources explained that the firm was employed on a 'no recovery, no fee' basis and had been recommended by other Local Authorities. The firm would identify duplicate payments, chase up the payments and claim a percentage of the money they recovered. The majority of the money was recovered from credits on invoices that had not been re-claimed. It was a twelve week project and as part of the contract, the firm would put forward some recommendations on areas for the Council to look at going forward.
As a result of the Councils reduced spending, it was queried whether the amount spend on auditing would reduced. It was explained that audit was about providing assurance that risks were being managed appropriately. Therefore if a Service was halved it did not necessarily mean that the audit work would be halved. However, it was possible that the number of audit days would reduce in future.
AGREED as follows:
1. that the draft Audit Plan 2013/2014 was received and noted.
2. a copy of the final Audit Plan 2013/2014 would be presented to the Audit and Governance Committee for approval at a future meeting.