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Agenda item

Internal Audit Plan 2016/17

Minutes:

The Committee considered the report of the Head of Audit Partnership setting out the one-year Internal Audit Operational Plan for 2016/17 and updating the longer-term Plan up to 2018/19.

 

The report was presented by the Deputy Head of Audit Partnership who advised the Committee that:

 

·  The basis of the Plan had changed in 2015/16 from a project to a days-led approach which had enabled a much greater responsiveness and flexibility in how the audit service was delivered.  At Maidstone in 2015/16, this enabled the Internal Audit team to provide support in the development of the Council’s risk management approach.

 

·  The restructuring of the Audit Partnership during 2015/16 meant that the team could deliver more productive days at no additional cost.  The total audit allocation for the Council in 2016/17 was 500 days, an increase of 30 days from the 2015/16 level.

 

·  The Public Sector Internal Audit Standards required the Head of Audit Partnership to explicitly draw the attention of Members to his assessment of whether the level of resources available was sufficient to fulfil responsibilities to deliver the Plan.

 

·  Having regard to the increase in the general risk environment in which the Council continued to operate, the Council’s commercialisation agenda and willingness to take on or support more ambitious projects to assist in the delivery of its priorities, and the introduction of a new Corporate Leadership team, it was the Head of Audit Partnership’s assessment that the level of resources available was sufficient in both quantity and capability to fulfil responsibilities.

 

·  There were a number of amendments to the Plan as circulated including:

 

Addition of an operational review of the adequacy of the contract monitoring arrangements at the Hazlitt Theatre (15 days);

 

Reducing the number of days allocated for a review of the effectiveness of measures to monitor and enforce compliance with HR policies from 10 to 8; and

 

Reducing the number of days allocated for a review of compliance with policy on awarding discretionary housing payments from 15 to 10.

 

·  These amendments would give rise to the total audit allocation for Maidstone of 500 days.

 

·  In 2017/18 a full risk assessment would be undertaken for the remainder of the Plan, and it was anticipated that the audit days allocated would be reallocated according to the assessment outcomes to ensure that resources were prioritised effectively.

 

In response to questions by Members, the Deputy Head of Audit Partnership confirmed that:

 

·  The revised version of the Plan would be circulated to all Members of the Committee and re-published online.

 

·  The increase in the number of Plan days allocated to risk management support from 20 days to 40 days reflected the expansion of the audit role in this area of service delivery which was recognised in the revised Internal Audit Charter.

 

·  The increase in the number of Plan days allocated to counter fraud support from 20 days to 40 days reflected the time spent by the Internal Audit team in this area in 2015/16, particularly in terms of the National Fraud Initiative, and there was much more of an expectation that the team would take on a validation role.  The increase also reflected the significant changes taking place within the Council’s counter fraud arrangements and the availability of skills and expertise within the Internal Audit team to support that.

 

·  The Annual Internal Audit report would include detail on how the Audit Plan days had been used over the year.

 

·  In terms of compiling the Audit Plan and liaison with the External Auditor, there was a protocol in place setting out how Internal and External Audit communicated and worked together.  In the past the Internal Audit team undertook work that the External Auditor placed reliance on, but this was less so now as the scopes and remits of Internal and External Audit were different.

 

·  The unallocated contingency of zero for 2017/18 was indicative at this stage.  The Internal Audit team provided assurance, consultancy services and advice.  The aim was to include an unallocated contingency of 10% within the Plan to provide the flexibility to react to consultancy and advisory requests.  A full risk assessment for the Plan would be undertaken in 2017/18 and contingency provision would be made at that stage.

 

RESOLVED:

 

1.  That the Internal Audit Operational Plan for 2016/17, attached as Appendix I to the report of the Head of Audit Partnership, be endorsed.

 

2.  That the longer term Plan up to 2018/19, attached as Appendix II to the report of the Head of Audit Partnership, and which will be subject to annual review and refresh, be noted.

 

3.  That the view of the Head of Audit Partnership that the level of resources available is sufficient to deliver the Head of Audit Opinion for 2016/17 be noted.

 

Supporting documents:

 

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