Agenda item

Report of the Deputy Chief Executive (Place)

The Committee considered a report of the Deputy Chief Executive (Place) which provided an update on progress made in implementing internal audit recommendations since the last update in March 2019.

The report indicated that the Public Sector Internal Audit Standards required that the “Chief Audit Executive (ie the Chief Internal Auditor) must establish a follow up process to monitor and ensure that management actions have been effectively implemented or that senior management have accepted the risk of not taking action.” As reflected within its terms of reference, the Audit and Procurement Committee was required to receive reports on Internal Audit’s follow up process. The report provided an update as to progress in respect of the agreed management actions which have been followed up during the period March 2019 to February 2020.

Currently, there were three key considerations that would determine the follow up procedure adopted, namely:-

1)  Whether the area audited was of such significance that it was subject to an annual review

2)  The level of assurance provided in the audit report

3)  A self-assessment process for these reviews where neither of the points above apply, but a follow-up review was necessary

Overall it was believed that the procedure achieved the right balance between ensuring action was taken in response to risks identified by Internal Audit and allowing the Service to focus on identification of new risks.

The report and appendices set out the results from the latest follow up exercise, indicating that of the 188 actions followed up, 62% had been implemented based on both the formal and self-assessment follow up method. When analysed by follow up method, the results were that formal follow up method had a 63% implementation rate and self-assessment follow up method had a 61% implementation rate.

In relation to self-assessment, the implementation rate of 61% reflected a reduction when compared to the last three years. Whilst there could be a number of factors which had contributed to this, particular reference was made to the introduction of a new template form to assist managers to undertake the self-assessment and face to face meetings held in some cases may have assisted managers to reach more appropriate conclusions on the level of progress made. Given that the current rate of implementation was comparable to that of the formal follow up method, it was viewed that the self-assessment process was fit for purpose at the current time.

No validation checks had been undertaken on self-assessment responses in 2019-20 due to other priorities within the Internal Audit Service. Due to the reported rate of implementation, this was not considered a significant risk at the current time.

In relation to dealing with outstanding actions, after the follow up had been completed, the results were collated within Internal Audit. If progress was not consistent with expectations, audit management would determine the next course of action, details of which were outlined in the report. Proposed actions for the audits where recommendations remain outstanding were highlighted within Appendices to the report.

The Committee agreed to highlight the importance of managers undertaking audits.

RESOLVED that:

(1) The progress made in implementing audit recommendations be noted and satisfaction with this and the proposed action by the Acting Chief Internal Auditor for Internal Auditor for audits where actions remain outstanding be confirmed.

(2) All managers be requested to ensure that the importance of audit work is acknowledged, with audits being carried out as required.