Internal Audit Annual Report and Opinion 2023/24
Minutes:
The Audit Manager presented the report which detailed her opinion on the operation of the Council’s governance, risk management and control frameworks. During 2023/24 free access to officer and records were given to complete their work and there had been no attempt by officers or Members to seek undue influence over the work during the year.
The opinion took into account all the work that had been completed by the Audit Team in the past year. Members were reminded that recruitment to the vacant post had been difficult and resulted in being unable to complete as much work that had been anticipated. The Audit Manager was pleased to advise though, that more work had been completed than the previous year and this was a positive for the Team.
The Committee was advised that it was her opinion that there was reasonable assurance that the Council’s governance, control and risk management frameworks were operating effectively. This recognised that most of the assurance work had returned positive assurance ratings with receiving three substantial assurance and a further six receiving reasonable but there were some improvements that needed to be made. There were five engagements still underway and they were nearing completion. The work on follow-ups indicated that Officers were implementing agreed actions to address control gaps and weaknesses as expected and she had no concerns to report to the Committee.
Members were advised that the executive summaries of all the audits completed in the year and were provided at annex A and the supplementary agenda provided the full report for the Sencio Audit.
Members were advised that there was still a vacancy for the Lead Auditor post, as recruitment to it had been unsuccessful.
Thanks was given for the work undertaken on procurement noted and its correlation to contract management.
Members considered the internal audit report noting the limited assurances and reasonable assurances listed, and raised some concerns. In response to the concerns raised that as part of the report findings, actions were agreed with Managers to address any control gaps and weaknesses. Once the implementation date was reached then a further visit would take place to see what work had been done and to ensure the actions had been implemented, which was reflected in the follow up figures. She further advised that the progress of the follow ups were reported for the procurement Audit as requested by the Audit Committee, and further updates on follow ups would continue to come to committee meetings. Members were assured that if it was believed that an unacceptable level of risk was not being addressed then it must be raised with the committee as part of the Audit Standards. The actions that were agreed as part of the control gaps and weaknesses and part of the high priority findings had implementation dates with assigned owners that were followed up by the Audit Team. The Chairman advised that it was within the gift of the Audit Committee that progress reports in regards to the actions being completed could be brought to the Committee, with a particular focus on procurement and contract management.
Members considered the Audit Report on Sencio, where some members expressed concerns that there was a lack of information provided in the report and additional lessons learned could have been detailed within the report. There was also concern that limited financial documentation was provided by Sencio to the Council. Members were advised that Sencio were a separate organisation and the Board did not share detailed information with the Trustees of the Board.
Members discussed the resolution agreed by Council previously, and advised that the Liquidator’s report had been provided to Members and it was the Liquidators who had access to Sencio’s accounts, and so the Council could not answer the two questions posed by Full Council, as the information was not within the Council’s gift. The liquidator’s report was on Sencio specifically rather than any form of partnership working, however there were previous reports where Sencio had attended the Scrutiny Committee for regular questioning. It was noted that the Council and residents had had a significant loss, but it was important to note what had happened and what could be learned for the future. It was expressed by a Member that information sharing with partners was important and how this would be managed with external providers for clear reporting lines.
The Chairman reminded Members that a session had taken place regarding any new leisure contracts which provided Members with the opportunity to give members the ability to input and improve on the contract management of future leisure providers. The Chairman used her discretion to allow a visiting Member to address the Committee. He advised that lessons learned were being demonstrated through the current leisure contracts and any future contract, and the Council had taken the difficulties it faced very seriously. A much stronger contractual relationship going forward was clear to see being implemented as well as continued monitoring by officers and Committees.
It was questioned whether a report on what happened and why it happened would assure residents that learning had been undertaken and the detail behind why Sencio went out of business was outside of the council’s remit and so definitive answers could not be provided.
Resolved: That the report be noted.
Supporting documents:
- 11 - Annual Opinion Covering Report July 2024, item 11. PDF 42 KB
- 11 - Appendix A - Internal Audit Annual Report and Opinion (July 2024), item 11. PDF 205 KB
- SDC23-2324M Sencio Contract FINAL Report, item 11. PDF 664 KB