Agenda item

Report of the Director of Finance

The Audit and Procurement Committee considered a report of the Director of Finance, which provided an update on the internal audit activity for the period April to September 2021, against the Internal Audit Plan 2021/22.  The report was the first monitoring report for 2021/22 and was presented in order for the Audit and Procurement Committee to discharge its responsibility ‘to consider summaries of specific internal audit reports as requested’ and ‘to consider reports dealing with the management and performance of internal audit’.

An Appendix to the report provided a list of the audits finalised between April and September 2021, along with the level of assurance provided.  As at 30^th September 2021, the following audits were in progress:

·  Compliance with Working Together Standards

·  File Storage

·  Purchasing Card Compliance

·  Green Homes Grant

·  PSDS Core Buildings Grant

·  Dol-y-Moch Recruitment

·  Parking Enforcement

·  Deprivation of Liberty Safeguards

Details of a selection of key reviews completed in this period were provided in a further appendix to the report.  In all cases, the relevant managers had agreed to address the issues raised in line with the timescales stated.  These reviews would be followed up in due course and the outcomes reported to the Audit and Procurement Committee. 

In relation to the Audit Review within Business Rates, the Committee noted that the Business Rates Team had significantly re-purposed its activities throughout 2020-21 in order to administer Covid-19 grants to businesses.  However, as a result, there had been a significant impact on the Service’s ability to maintain its normal systems, levels of control and working practices.  It was acknowledged that this was not a result of management failings and that there was confidence that this was a temporary situation which did not impact on the level of assurance that was provided in relation to the objective.

In considering the Audit Review relating to the Broadgate House Payment Kiosks, the Committee noted that investigations behind discrepancies in the reported end of year cash balances were undertake but that not all cash which had been administered by Customer Services could be adequately accounted for.  Whilst the review identified two possible explanations, it was not possible to reach a conclusion with any degree of certainty as to what had taken place.  There were indications that the issue had occurred as a result of software / kiosk errors, it was not possible to rule out that cash may have been misappropriated, although there were no other factors identified to support this.

At the end of September 2021, the Service had completed 33% of the Audit Plan against a planned target of 50%.  It was acknowledged that progress in quarter two was below target, although it was comparable to performance at the same point last year.

The Internal Audit Plan for 2021-22 was submitted to the Committee at its meeting on 28^th June 2021.  That report had explained that the level of resources available in 2021/22 for audit and corporate fraud work could not be precisely defined when the Plan was developed due to staff vacancies within the Service.

As a result, the Internal Audit Plan was developed on an estimate of 650 days available for audit and corporate fraud work, but this would be monitored, with any resulting changes provided in future reports to the Committee.  Whilst all vacant posts were now being recruited to, at the current time, management were not in a position to accurately define the impact on the available audit days.  However, achievement of 90% of the Plan by the end of March 2022 remained a key priority for the Internal Audit Service and a flexible approach would be taken to utilise resources to meet this target.

In considering the report, the Committee discussed the level of resources required to undertake an audit review and, in particular, how much manual work is required and whether better use could be made of data analytics and artificial intelligence.  It was agreed that a report on the possibility of using data analytics, including artificial intelligence be included on the work programme for 2022/23.

RESOLVED that the Audit and Procurement Committee:

1.  Notes the performance ats at quarter two against the Internal Audit Plan 2021/22.

2.  Considered and notes the summary findings of the key audit reviews detailed in an Appendix to the report.

3.  Request that a report on the use of data analytics, including artificial intelligence, be added to the work programme for 2022/23.