Agenda item

This interim report summarises the work of Internal Audit during the first six months of 2015/16.  The purpose of this report is to enable the Committee to consider the activities of Internal Audit during the six month period to 30 September 2015 and determine whether there are any matters that they wish to draw to the attention of the Cabinet and/or the County Council. 

Declarations of interest:

None.

Witnesses:

David John, Audit Performance Manager

Key points raised during the discussion:

1.    The Audit Performance Manager introduced the report.

2.    In response to a query about the increase in the proportion of audits receiving opinions of ‘significant improvement needed’, the Audit Performance Manager suggested that there wasn’t a single answer.  He highlighted that the Audit Plan was risk-based, so it was looking at areas which may be more likely to receive that audit opinion.  However, the Audit Plan had been risk-based for a number of years.  There did not appear to be any pattern as to where the ‘significant improvement needed’ opinions were being received.  There may be some pattern associated with the auditor assigned to an audit.  It may also be that by the end of the financial year, the proportion of audits receiving ‘significant improvement needed’ will have fallen.  Members noted that they still had concerns about the half year figure of 23% of audits receiving ‘significant improvement needed’.

3.     The Audit Performance Manager clarified that the audit opinions listed for 2015/16 under paragraph 7 were new for this year.  Audits receiving follow up reviews were not listed in this table.

4.    The Audit Performance Manager informed the committee that the Internal Audit team had shrunk over the past 15 years.  However, it had also developed a more comprehensive and targeted Audit Plan.  Vacancies had been covered with good agency staff.  280 days were also set aside as a contingency to deal with any special investigations in-year.  The Audit Performance Manager confirmed that the Chief Internal Auditor would be able to provide an audit opinion at the end of the year.

5.    Financial Assessment and Benefits – There was concern at the management response to the recommendation for monthly reporting to committees and management teams on the number of clients that have been referred to the service but are waiting for a financial assessment.  It was felt that the service should understand what its demand is before it can plan to address it.  Members also queried how long into 2016 the IT system would be operational.  Officers confirmed that this was being proposed for mid-2016.  The committee agreed that the Chairman should write to the new Strategic Director of Adult Social Care and Public Health, copying in the Cabinet Member and Scrutiny Board Chairman (Recommendations Tracker ref: A43/15).

6.    Fire Station Capital Project Management – The Audit Performance Manager informed the committee that Audit had now assessed progress against the Management Action Plan (MAP) to be Green, following information being received from the service.  Internal Audit does not usually conduct a follow-up audit for medium priority recommendations but as discussion are held regularly with Surrey Fire and Rescue Service, auditors will know informally if there are any further problems.

SajHussain left the meeting at 11.27am.

7.    Members’ Interests – It was suggested that consideration of whether the Members’ Code of Conduct should include a requirement to disclose non-pecuniary interests should be undertaken by Audit & Governance Committee as it has responsibilities for ethical standards.

SajHussain rejoined the meeting and Tim Hall left the meeting at 11.31am.

8.    Direct Payments (Children) – The Audit Performance Manager suggested that preventing any reviews from becoming overdue was possibly over-ambitious.

9.    Accounts Receivable – The Audit Performance Manager suggested that the assessment of action responding to the recommendation that the service should change the overpaid salaries invoicing process with a view to separating the customer information upload from the invoice upload should have been amber as the meeting had been scheduled.  He was not aware of the outcome of the meeting but clarified that the assessment was Amber not Red.

Tim Hall rejoined the meeting at 11.35am.

10.  Surrey Arts – The Audit Performance Manager explained the insurance in place for accidental damage, vandalism or theft of musical instruments.  Members asked for further detail on insurance excess for theft from Surrey Arts and the total value of instruments owned by Surrey Arts (Recommendations Tracker ref: A44/15).

Action/Further information to note:

a)    The Chairman to write to the new Strategic Director of Adult Social Care and Public Health, copying in the Cabinet Member and Scrutiny Board Chairman, regarding the management response to an Internal Audit recommendation regarding outstanding assessments.

b)    Further detail to be provided on insurance excess for theft from Surrey Arts and the total value of instruments owned by Surrey Arts.

RESOLVED:

The committee NOTED the report.