Joint Audit and Governance Committee |
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Report of Internal Audit Manager Author: Victoria Dorman-Smith E-mail: victoria.dorman-smith@southandvale.gov.uk SODC cabinet member responsible: Councillor Leigh Rawlins Tel: 01189 722565 E-mail: leigh.rawlins@southoxon.gov.uk VWHDC cabinet member responsible: Councillor Andy Crawford Telephone: 01235 772134 E-mail: andy.crawford@whitehorsedc.gov.uk
To: Joint Audit and Governance Committee DATE: 25 January 2022 |
AGENDA ITEM |
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Internal audit management report quarter three 2021/22
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Recommendation(s)
(a) That members note the content of the report.
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Purpose of report
1. The purpose of this report is:
· to report on management issues within internal audit;
· to summarise the progress against the 2021/22 audit plan up to 17 January 2022; and
· to summarise the priorities for quarter four 2021/22.
2. The contact officer for this report is Victoria Dorman-Smith, Internal Audit Manager for South Oxfordshire District Council (SODC) and Vale of White Horse District Council (VWHDC), telephone 07766 780835, email victoria.dorman-smith@southandvale.gov.uk.
Strategic objectives
3. Delivery of an effective internal audit function will support the councils in meeting their strategic objectives.
Background
4. The Public Sector Internal Audit Standards (PSIAS), effective from 1 April 2017, state that the head of internal audit should prepare a risk-based audit plan, which should outline the assignments to be carried out and the resource requirements to deliver the plan, for audit committee approval. The Joint Audit and Governance Committee approved the 2021/22 annual internal audit plan on 30 March 2021.
5. The PSIAS also states that the head of internal audit must periodically report on performance relative to the plan.
Management issues
6. The internal audit manager returned from maternity leave on 22 November 2021, consequently the contract with the interim internal audit manager, Richard Green ended on 26 November 2021.
Progress against the 2021/22 audit plan
7. Progress against the approved audit plan for 2021/22 has been calculated for the quarter and year to date and is summarised in appendix 1 attached.
8. Performance figures to date are as follows:
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Target |
YTD |
Actuals by Quarter |
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Q1 21/22 |
Q2 21/22 |
Q3 21/22 |
Q4 21/22 |
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Chargeable (identifiable client and/or specific IA deliverable) |
76% |
55% |
54% |
58% |
56% |
- |
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Non-Chargeable (corporate, not IA deliverable) |
7% |
21% |
20.5% |
22% |
20% |
- |
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Planned Lost (i.e. leave) |
14.5% |
19% |
21.5% |
12% |
22% |
- |
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Unplanned Lost (i.e. study, sickness) |
2.5% |
5% |
4% |
8% |
2% |
- |
9. As at 17 January 2022 the status of audit work against the 2021/22 audit plan is as follows:
Planned
Strategic, operational and financial assurance and consultancy work known and approved by the joint audit and governance committee.
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2021/22 |
Planned |
Not Performed (Removed) |
Deferred |
To commence Q4 |
In progress |
Completed or Draft Out |
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Total |
34 |
7 |
6 |
8 |
5 |
8 |
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Joint |
32 |
5 |
6 |
8 |
5 |
8 |
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SODC |
1 |
1 |
0 |
0 |
0 |
0 |
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VWHDC |
1 |
1 |
0 |
0 |
0 |
0 |
Based on the internal audit manager’s assessment of the remaining audits (in progress and to commence in Q4), available audit hours to 31 March 2022, and suitability of audits at this time, the following updates have been made to the annual audit plan:
Audits to remove
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Audit Type |
Comments |
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Payroll |
Key Financial |
Payroll not audited in 21/22, due to the previous audit being reported in July 2021. However, a follow up of the previous audit recommendations will be performed in Q4 and the next payroll audit will be scheduled for Q1 of 22/23. Payroll is replaced by Learning and Development. |
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Pro-Active Anti-Fraud Review |
Key Financial |
Review of fraud risks considered in every audit now – new scoping template to support this. Separate audit not required. |
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Receipt & Collection of Income |
Operational |
Replaced by a Cash Office audit, which is already completed. |
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Didcot Community Facilities |
Consultancy |
Work is either underway or under consideration in these areas, so no value to be gained at this stage from a consultancy review. |
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Cornerstone |
Consultancy |
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The Beacon |
Consultancy |
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Corporate Landlord |
Consultancy |
Audits to defer
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Audit Area |
Audit Type |
Comments |
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Estates & Facilities Management |
Operational |
This area is moving under Corporate Landlord model, which is a work in progress. No added value from an internal audit in 21/22 |
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IT Operations |
Operational |
Significant work on IT strategy currently in progress, defer audit to a later date, once finalised. |
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Planning Applications |
Operational |
Review of the development management process currently being commissioned. No added value from an internal audit. |
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Planning Enforcement |
Operational |
Recent Council paper considered planning enforcement, therefore audit deferred. |
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Procurement |
Operational |
New procurement strategy in place – audit in 22/23 to review progress. |
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Whistleblowing & Fraud |
Operational |
Audit not required, no areas of concern or high risk. |
Audits to commence in Q4
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Audit Area |
Audit Type |
Comments |
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Capital Management & Accounting |
Key Financial |
Annual review of the capital financial strategy and asset management plan, capital contracts and budget monitoring, and the completeness and accuracy of the asset register. |
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Housing Benefits & Council Tax Reduction Scheme |
Key Financial |
Annual review of housing benefits and CTRS payments, benefit assessments and subsidy claims, and benefit overpayments. |
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Follow Up of Payroll 20/21 Recommendations |
Key Financial |
Payroll not audited in 21/22, due to the previous audit being reported in July 2021. However, a follow up of the previous audit recommendations will be performed in Q4. |
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Brown Bins |
Operational |
Audit initially started in June 2021 and will recommence in Q4; however, the audit scope will be revisited to address current risks. |
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Disposal of Assets & Property |
Operational |
Disposal’s strategy newly implemented (Sep-21). Limited review of policy contents and any disposals since adoption of new policy. |
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Information Governance (incl. SAR, GDPR, FOI) |
Operational |
No specific areas of concern and last audited in 17/18. |
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Learning & Development |
Operational |
Replaces Payroll 21/22 audit. |
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S106/CIL |
Operational |
Review of income collection. |
Ad-hoc
Unplanned project work based on agreed terms of reference with the audit manager (i.e. implementation of new systems) and responsive work issued and agreed by the section 151 officer, members or senior management team (i.e. investigations).
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2021/22 |
Requested |
Complete |
Draft |
In progress |
To commence |
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Ad-hoc |
0 |
0 |
0 |
0 |
0 |
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Joint |
0 |
0 |
0 |
0 |
0 |
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SODC |
0 |
0 |
0 |
0 |
0 |
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VWHDC |
0 |
0 |
0 |
0 |
0 |
Follow up
Work undertaken to ensure that agreed recommendations have been implemented. The number of follow-up audits is a rolling number, all internal audit reports are followed up after six months unless the area is subject to an annual review.
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2021/22 |
Requested |
Complete |
Draft |
In progress |
To commence |
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Follow up |
0 |
5 |
0 |
0 |
1 |
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Joint |
0 |
4 |
0 |
0 |
1 |
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SODC |
0 |
0 |
0 |
0 |
0 |
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VWHDC |
0 |
1 |
0 |
0 |
0 |
Priorities for 2021/22 quarter four (January – March 2022)
10. The priorities for quarter four are to:
· Continue the planned audit work for 2021/22, in line with the audit plan;
· Prepare the annual audit plan for 2022/23;
11. The schedule for remaining 2021/22 planned audit work can be reviewed in appendix 2.
Financial implications
12. There are no financial implications attached to this report.
Legal implications
13. None.
Risk implications
14. Identification of risk is an integral part of all audits.
VICTORIA DORMAN-SMITH
INTERNAL AUDIT MANAGER