Agenda item

Report of the Director of Finance and Resources

The Audit and Procurement Committee considered a report of the Director of Finance and Resources (Section 151 Officer) that provided an update on the internal audit activity for the period April to September 2025, against the Internal Audit Plan for 2025-26. The report was the first monitoring report for 2025-26, which 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'.  Appendices to the report provided: the Audit Reviews Completed between April and September 2025; and the Summary Findings from Key Audit Reports.

The Internal Audit Plan for 2025-26 was presented to the Audit and Procurement Committee at its meeting on 23rd June 2025 (minute 4/25 referred) and provided for 650 days of internal audit work in 2025-26. As the Plan was agreed at the start of the financial year, it was always likely to be subject to some amendments due to changes in the risk environment, requests from service areas to reschedule work, and other exceptions, with significant changes reported to the Committee. As a result of unplanned absence in the Service and the time taken to implement the agreed service redesign, it had been necessary to make changes to the Audit Plan given the reduction in available resources, therefore the Plan was now based on the provision of 550 days of internal audit work in 2025-26. This had been accommodated through re-programming some internal audit work into the 2026-27 Audit Plan and changes in the risk environment impacting on the requirement for audit involvement. The key target was for the Internal Audit Service to complete 90% of its work plan by 31st March 2026. A chart in the report provided analysis of progress against planned work for the period April to September 2025 based on the revised audit plan of 550 days. 

At the end of September 2025, the Service had completed 45% of the Audit Plan against a benchmark of 50% (which reflected delivery of 100% of the Plan.)  Whilst this showed the Service to be on track to achieve the target of 90% by the end of 2025-26, the impact of the unplanned absence in particular would be visible in the quarter three performance which was due to be reported to the Audit and Procurement Committee in March 2026. Notwithstanding this, the Service remained committed to achieving the target by the end of the financial year. It was the view of the Chief Internal Auditor that these changes would not, in any significant respects, impact on the ability to deliver the annual internal audit conclusion.

At its meeting in November 2025 (minute 26/25 referred), the Audit and Procurement Committee approved the performance indicators for the Internal Audit Service for 2025-26, in line with the Global Internal Audit Standards in the UK Public Sector. Whilst some of these indicators were measured on an annual basis, there were two that were measured quarterly and these were summarised in a table in the report. The report also provided details of comments made by customers, in addition to the high customer feedback scores.

It was noted that the indicator relating to the percentage of audit recommendations implemented as planned was not exclusively a reflection of Internal Audit performance, as management were responsible for completing agreed actions.  However, notwithstanding this, the Internal Audit Service were in the process of putting in place additional measures to support the gradual improvement of implementation rates which included further development of the directorate trackers, specific discussions at the draft report stage on the importance of the timely implementation of agreed actions, and enhancements to the follow up process to make officers more accountable for lack of progress.

Appendix One to the report listed the audits finalised between April and September 2025, along with the level of assurance provided. At 30th September 2025 there were no audits at Draft Report Stage, and the on-going audits were Property Disposals, Ransomware Threat, Our Lady of Assumption Catholic Primary School, Occupational Therapy Equipment, Commercial Property Rent, Purchasing Cards (Children’s and Education), and Noise Team Rotas. Details of a selection of key reviews completed in this period were provided at Appendix Two 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.

RESOLVED that the Audit and Procurement Committee:

1)  Notes the performance as at quarter two against the Internal Audit

   Plan for 2025-26.

2)    Notes the summary findings of the key audit reviews attached at Appendix Two to the report.