Agenda item

Further to Minute No. 22 of the meeting held on 21st September, David Webster, Head of Internal Audit, submitted the third progress report on the implementation of the recommendations made in the PWC review of Internal Audit.

Internal Audit had operated with a high vacancy level during most of 2016 to date.  In addition there had been significant change since production of the PwC report including a refresh of procedures, a full service restructure and the subsequent recruitment to the Head of Internal Audit and a vacant senior auditor post.

Appendix 1 contained a full update of progress against the PwC recommendations with the key points being:-

Actions completed/certain to be completed as at October, 2016

-          19 actions, spread across 17 recommendations, 10 of which had been completed, 3 rated green (certain to be achieved) and 6 were amber rated (in progress/on target).  There were no red rated actions

Key progress as at October

-          2015/16 audit plan successfully delivered (with 95% delivery achieved against the final plan)

-          Completed service review and a restructure determined

-          Audit structure and budget set up to provide for specialist audit resources to be engaged as required to carry out specified work in the audit plan

-          Audit agreement between Rotherham and Doncaster Councils terminated on 30^th September, 2016

-          Improved consultation and engagement with senior management in audit planning and reviewing progress

-          Recruitment to the new structure

-          PDRs completed and a team development plan produced/implementation commenced

-          Revised Audit Charter and Strategy

-          Streamlined and improved audit review process

-          New risk based style of audit report

-          Evaluation of bids for an electronic audit system

Key actions in progress:-

-          Production of plan to achieve full compliance with auditing standards, subject to regular review and reporting to Audit Committee

-          Embedding of new audit scoping, reporting and performance monitoring and management processes

-          Need for implementation of team development plan

-          Implementation of electronic audit system, streamlining of administration and reduction of non-productive time

-          Development of assurance mapping

-          Development and reporting to Audit Committee of Quality Assurance and Improvement Programme to improve and maintain standards

-          Full refresh of the Internal Audit Manual to reflect new PSIAS compliant, audit policies and procedures

-          Establishment of programme to review the Council’s Governance Arrangements set out in its Code of Governance

The Service would remain in transition until the Team reached full establishment.  The procurement and implementation of an integrated audit management system would also facilitate consistency in the way in which audits were conducted and compliance with auditing standards.

It was required that an annual internal assessment be made of conformance with the Standards.  This would be completed by the Head of Internal Audit and reported to the Audit Committee in February, 2017. 

An external assessment was also required every 5 years by a qualified independent assessor.  External assessments could be in the form of a full external assessment or a self-assessment with independent external validation.  The CIIA had accepted that reviews within a peer group met the requirements for external assessments provided that the reviews were not reciprocal and were demonstrably independent, therefore, the review could be carried out by Veritau Ltd. or another South/West Yorkshire authority.

Progress against the action plan would be reported to the Audit Committee during 2016/17.  Veritau Ltd. had been asked to comment on the progress reports and commented that it was a reasonable reflection of progress being made to implement the proposed actions.

Resolved:-  That the progress made in implementing the recommendations included in the PwC review of Internal Audit be noted.