Agenda item

To include:

·       Internal Audit updates

·       Outstanding Audit actions

·       Internal Audit Q3 plan for information and Internal Audit Q4 plan for approval

·       A presentation on the future of Internal Audit

At the Chairmans invitation, David Hill (SWAP) presented the Internal Audit (IA) reports.

Mr Hill highlighted page 12 of the agenda pack which gave an overview of the IA update. The overall opinion was reasonable. One significant risk was identified, which had a limited assurance opinion, this was the Pension Payroll Reconciliation Project. A lot of issues had been identified and the opinion given would have been no assurance, however the service had already completed some of the actions, hence the limited assurance opinion. The Section 151 officer had been aware of issues and had requested SWAP to look at the project. Some outside resources were being deployed to help with the reconciliation.

Regarding the Outstanding Priority 1 and 2 actions, there were still quite a lot to be completed which was disappointing.

In response to questions Lizzie Watkin (Assistant Director Finance and deputy S151) explained that the Wiltshire Pension Fund Committee and Pensions Board would look at the Pension Payroll Reconciliation Project. Members could discuss with the Chairs of those committees to ensure that they got assurance. It was confirmed that ultimate responsibility lay with the Audit and Governance Committee. 

The officer stated that officers may consider the need to create task groups that report back to the Audit and Governance Committee, similar to the process used by the Overview and Scrutiny Management Committee, so that everyone got the required feedback and assurance.

Ian Howse (Deloitte) stated that Deloitte audit the Pension Fund as well. There were not any material discrepancies, but the issues did need to be resolved. 

The outstanding management actions were discussed. While the number had decreased which was positive, there were still many which had been not been completed which was concerning. Discussions were underway with SWAP on how the actions could be monitored.

Lizzie Watkin explained that she as working closely with SWAP to review the actions and get the evidence to ensure they had been implemented. This was a very manual and time consuming task, so the process needed some work. Performance Outcome Boards should also look at the actions and mitigate the risks. They were working through the new system SWAP were implementing to see what it can do and how it could make things more effective for officers and the Committee.

In response to a question regarding the impact of negative media/social media coverage on Council, where there had been no IA coverage, Perry Holmes (Director, Legal and Governance) stated that there would be gaps occasionally due to resourcing, but there was a capable communications team who managed this.

Councillor Mark Connolly proposed a motion which was seconded by Councillor Chuck Berry and it was,

Resolved:

·       To note the November 2022 Internal Audit Update Paper and Summary of Outstanding Priority Actions.

·       To note the 20022/23 Q3 Internal Audit Plan.

·       To approve the 2022/23 Q4 Internal Audit Plan. 

Mr Hill then gave a presentation on IA which is appended to these minutes. Some of the main points covered included that the size of reports had always been an issue, which was why the 1 page report which summarised the situation was introduced.

Internal Audit would change a lot in the future, with a lot of the work being undertaken by Artificial Intelligence (AI).

Mr Hill then demonstrated a new IA dynamic Dashboard which had been developed. This would enable SWAP to report live at committees and would be available in the next quarter. It would really help Members to drill down into the detail. Members were pleased and looked forward to its roll out.

In response to a question as to whether the new ERP software would have a live Dashboard on the budget, officers explained that the Financial Planning Task Group and Overview and Scrutiny Committee reported to Cabinet to give assurance regarding the budget. The Audit and Governance Committee was not responsible for budget monitoring, but rather governance, compliance, financial risk (via audits) and best practise. At this first stage of the ERP project there would not be a budget monitoring Dashboard for councillors.

In response to a further question Mr Hill stated that regarding risk registers, SWAP had a list of top 10 risks, and looked at risk registers to see if these were included. They could also compare between councils, although risks could be quite different between councils. Members felt it would be useful to learn from other rural unitary authorities. Officers stated that this was something that was regularly discussed with SWAP.

The Chairman thanked Mr Hill for the presentation.