Agenda item

Progress Report on Internal Audit Activity

To examine the progress made between 1 April 2019 and 4 November 2019 in relation to the completion of the Annual Internal Audit Plan for 2019/20 (report of the Head of Internal Audit for SHDC enclosed).

Minutes:

Consideration was given to the report of the Head of Internal Audit, which examined the progress made between 1 April 2019 and 4 November 2019 in relation to the completion of the Annual Internal Audit Plan for 2019/20.

 

The Governance and Audit Committee received updates on progress made against the annual internal audit plan.  The report formed part of the overall reporting requirements to assist the Council in discharging its responsibilities in relation to the internal audit activity.

 

The Public Sector Internal Audit Standards required the Chief Audit Executive to report to the Governance and Audit Committee the performance of internal audit relative to its agreed plan, including any significant risk exposures and control issues.  The frequency of reporting at South Holland was to each meeting.  To comply with the above requirements, the report identified:

 

·         Any significant changes to the approved Audit Plan;

·         Progress made in delivering the agreed audits for the year;

·         Any significant outcomes arising from those audits; and

·         Performance measures to date

 

The Committee was advised that details of progress made in delivering the agreed audit work, and the outcomes arising from the auditor’s work was detailed within the report.

 

The following significant changes had been made to the plan:

 

·         Accounts Receivable and Income – This had been delayed to 2020/21 as PSPS was currently undertaking a large piece of work in the form of a finance system upgrade.  After this work had been done, substantive testing could be undertaken.  In the meantime, there would be an audit of key controls which would provide some assurance.

·         Office 365 – This product had not yet been installed.  Updates were being received from the Technology Board in relation to implementation, and this audit had therefore been deferred to 2020/21, when the work on installation had been completed.

 

During the period covered by the report, Internal Audit Services had issued five final reports – Private Sector Housing (No Assurance); Section 106 Agreements (Reasonable Assurance); Strategic Housing (Reasonable Assurance); Environmental Protection (Reasonable Assurance); and Leisure (Reasonable Assurance).

 

With regard to the No Assurance assessment of Private Sector Housing, there were 16 ‘urgent’ recommendations, 6 ‘important’ recommendations and 6 ‘needs attention’ recommendations that had been identified.  These were listed in more detail within Appendix 2 to the report.

 

The Housing Landlord Manager was in attendance to provide an update on work that was being undertaken to address the recommendations within the Private Sector Housing audit.  The main points were:

 

·         Caravan licensing – there was now a process in place in conjunction with the Planning department;

·         The Northgate system had been purchased, and implementation within Private Sector Housing, which would resolve some of the outstanding issues, was now underway.  The design work needed to bring in bespoke information;

·         There were a number of policies that were being worked on as part of the review.  The Empty Homes Strategy had been presented to the Policy Development Panel in the last month, and work was moving forward with other strategies;

·         The Community Housing Renewal Policy needed updating – this was an overarching policy to cover financial assistance;

·         It had been possible to overcome a number of issues during the audit.  All work that could be completed to date had been, and work would continue. 

 

Members commented that there appeared to have been many problems, and asked if reasons for this had been identified? Was resourcing an issue?  The auditor considered that resourcing was not the root cause to the problems encountered.  There had been some ‘system’ problems, and when putting a workflow system in place, it would be ensured that these issues were picked up.  

 

It was noted that the audit team at East Lindsey District Council was merging with the audit team at Lincolnshire County Council.  Members were concerned that, due to a proportion of the internal audit plan being delivered by the East Lindsey team currently as part of the various audits, would this be an issue?  The Strategic Finance and Compliance Manager advised that she had met with relevant officers to discuss the transition, and had received assurances that this would not be a problem.  Once the detail and the timeline was known, all officers would work closely together to ensure that the transition was as seamless as possible.

 

AGREED:

That the report be noted.

Supporting documents: