Issue - meetings

The report of the Director – Finance and Corporate Services is attached.

Mr Gurpreet Dulay, from BDO, the Council’s internal auditor presented the Internal Audit Annual Report, which summarised the work undertaken during the course of 2020/21, and the management actions arising from the audits, together with the annual opinion of the Head of Internal Audit.   

Mr Dulay advised that this was the last report for the financial year and BDO was required to provide an annual opinion and it had concluded that the Council had a moderately sound system of internal assurance (with Moderate being the second highest rating) and the Group was advised that no local authority this year had received the highest Substantial rating and was a positive outcome.  The Group noted that of the nine audits, five had resulted in a green ‘Substantial Assurance’ rating, three with an amber ‘Reasonable Assurance’ rating, and one, the Annual Fraud Report was not classified in the same way.  In addition, 27 management actions had been identified, including 12 ‘Medium Priority’ and 15 ‘Low Priority’, where management actions had been agreed in all cases.  Mr Dulay also emphasised that this was the first year that BDO had undertaken this audit and had used different scoping to predecessors; however, the Group was advised that there were no significant changes compared to previous audits. 

The Director – Finance and Corporate Services stated that this was a very positive report, particularly given the extremely challenging year and the need to maintain services and manage risks.

The Chairman referred to the Covid 19 Grants Assurance and questioned the test sample size of 20 grant payments out of the 1,660 total number of payments made, and sought reassurance that the testing had been robust, as the report highlighted that there was no absolute assurance on the remaining grants.

Mr Dulay advised that although the sample size appeared small, a wider review of specific parameters had been undertaken to identify any indicators of fraud.  The Group noted that a key part of the sample testing was to look to see if the Council had key arrangements in place, which it did, and it had been concluded that from the samples taken, no concerns had been raised and substantial assurance was provided.

Members asked that in respect of the overall opinion for the year, were the individual audits weighted?

Mr Dulay confirmed that no weighting was applied; however, for any fundamentally key service, such as a main financial system, a judgement would be made as to its overall importance and the Director – Finance and Corporate Services confirmed that there was an implicit scoring system, as some systems and services were monitored more frequently than others.             

It was RESOLVED that the Internal Audit Annual Report 2020/21 be noted.