Agenda item

The Annual Internal Audit Report & Opinion provides a summary of audit work undertaken during the year (2022-23) to obtain all information and explanations considered necessary to provide sufficient assurance that the control environment is both reasonable and effective.  Whilst no assurance can ever be absolute, on the basis of audit work completed, it is the Chief Internal Auditor’s opinion that the Council’s framework of governance, risk management and control is ‘reasonable’.

[15 Minutes]

            The Chair welcomed Iona Bond, Senior Audit and Counter Fraud Manager,from Southern Internal Audit Partnership (SIAP), who then presented the report to the Committee. This was the Annual Report and Opinion for 2022/23, which summarised the internal audit activity across a range of Arun’s functions during the year. She highlighted that sections 1-3 (Page 105 – 107) of the document contained background to the audit; section 4 (Page 108) provided the overall annual opinion for the Council, reflected in the table towards the bottom of page 108. Overall, they were able to provide a ‘reasonable’ audit assurance opinion for the purposes of the report, which was good; section 5 (page 109) provided a summary of work in the areas of Risk Management, Control and Corporate Governance, which framed the remit in which they placed the annual assurance opinion; pages 111-114 detailed the four areas of audit review during the course of 2022-23, which resulted in a limited assurance opinion; page 115 detailed the management actions, and a statement that SIAP were satisfied with these actions; SIAP had also completed two pieces of work on the irregularity of procurement, which centred around following of procurement rules. Both of those reports were currently with management and any further update would be provided through the progress report to Committee; section 11 thanked Arun Officers and staff who had all been engaged with the process; pages 118 – 125 set out each of the completed audit areas with details of scope and key areas for improvement identified; page 125 listed all the changes to the plan made during the year.

The Chair thanked the Senior Audit and Counter Fraud Manager for her and her team’s work on this, and he also thanked the Arun Officers who had been engaged throughout the year. Members were reminded if they had any questions regarding the exempt appendix, they would need to move into exempt business prior to that. Members then took part in a question and answer session as summarised below.

One Member stated he wished to ask a question regarding the exempt appendix.

Page 111 detailed an excess in spending on agency staff and the oversight of this, it was asked whether SIAP recommended measures to Officers to ensure they could avoid this in the future. The Senior Audit and Counter Fraud Manager explained SIAP no longer came up with a series of recommendations, however they did come up with a series of observations which drew out where the areas of weakness within the particular area were. This prompted managers to review and take ownership of actions they believed were necessary to mitigate or cancel out those risks. SIAP would then review these actions to ensure they were satisfied that those weaknesses were being managed. This would also be brought back to the Audit & Governance Committee. The Internal Audit Manager confirmed that the findings of the agency audit were on the agenda of the Corporate Management Team and the Group Head of Organisational Excellence, and they were currently liaising with procurement advisors at Hampshire County Council to identify a framework arrangement whereby they could obtain agency staff in a better way.

There was concern around procurement in general and it was asked whether this was being looked at as a whole or just in relation to agency staff. The Senior Audit and Counter Fraud Manager explained that the management were aware that procurement was an area that needed looking at more closely in terms of ensuring compliance with the required levels.

Page 121 under Climate Strategy noted sound framework of control was found to be in place with some observations for improvement, and it was asked where the observations could be found. The Senior Audit and Counter Fraud Manager explained the observations and management actions rested with the managers of those service areas. The Committee would receive a high level summary and update on the state of implementation of those actions. Where a management action was overdue and this was high priority, the Committee would receive further detail.

As one Member had indicated he wished to speak regarding the exempt appendix, with the agreement of the Committee, the Chair paused discussion of this Item, which would resume following the Work Programme Item in exempt session.