The Audit and Assurance Manager presented a report to update Members on the main findings arising from internal audit work carried out since the annual report was submitted to Members. In addition, the report briefed Members on the performance of the Councils internal audit service, Tees Valley Audit and Assurance Services (TVAAS).
A brief summary of all internal audit reports issued in final, since the last update to the Corporate Affairs and Audit Committee, was provided at Appendix 1 to the submitted report. Reports issued in final included four schools, the Youth Offending Service and the Registrars Service. Two Priority 1 recommendations were still outstanding from previous periods and the latest update to Members was also provided at Appendix 1. One further Priority 1 recommendation had been made this year.
In addition to the final audit reports issued in Appendix 1, TVAAS staff had been involved in a number of other areas of work that did not result in the issue of a formal report. Those areas were included at paragraph 6 of the submitted report.
It was highlighted that the internal audit report on Project Governance and Property Disposals referred to in previous external audit reports was currently in draft and awaiting agreement with management. The overall opinion of this report currently provided an overall assurance opinion of a Cause for Concern and would include one Priority 1 recommendation. Overall, the final report would identify that improvements were required to the Councils project governance and property disposal processes in order to ensure that the control environment is effective going forward. The Audit and Assurance Manager noted that the Council was already taking steps, via its Governance Improvement Plan, to address the project management issues identified in this and the recent Project Management audit report.
The Project Management audit was one of the contributory factors in the External Auditors qualification for Value for Money in the Statement of Accounts. The Audit and Assurance Manager confirmed that whilst she was satisfied with progress to date, there would be continuous monitoring until all the actions were fully implemented.
Appendix 2 to the submitted report detailed TVAAS Performance Target Position for 2015/2016. Currently the percentage completion of the agreed Annual Audit Plan was 31%. The Manager clarified that the average customer satisfaction survey score, at 3.73, was determined from feedback from a survey issued with each audit. The highest possible score was 4.
A Member queried the timescale for the current P1s to be addressed. The Audit and Assurance Manager clarified that P1 recommendations were made where there was a significant risk that the Council needed to address and this would not be a quick fix. The main issue with the Councils Project Management was that there was no Corporate Framework for all managers to comply with. A detailed timetable for implementing the required actions had been issued with the Annual Governance Statement and provided at the last meeting.
A request was made that copies of all future audit reports containing P1 recommendations should be issued to Members of the Corporate Affairs and Audit Committee.
Another issue raised by Members was the monitoring of projects and examples were given of projects that had over-run and incurred additional expenditure. The Deputy Chief Finance Officer confirmed that the aim of the new project management process was to make sure such issues were picked up sooner and flagged up with senior officers as early as possible, in order to minimise the risk of projects going off target and protect the Council from any financial penalties.
In response to a query regarding Purchasing Cards and the controls in place to ensure they were used appropriately, the Deputy Chief Finance Officer informed Members that the Council had agreed a strategy of using Purchasing Cards due to cost effectiveness. The Audit and Assurance Manager added that an audit of Purchasing Cards had been undertaken and reasonable controls were in place.
AGREED as follows that:
1. the information provided was received and noted.
2. all future Internal Audit Reports containing P1 recommendations would be circulated to Members of the Corporate Affairs and Audit Committee.
3. Details of the number of Purchasing Cards currently in use would be provided to the Committee.