To receive and consider report 92/09 of the Audit Manager.
The committee received and considered report 92/09 of the Audit Manager that set out detailed audits of council services completed during the third quarter (October to December) of 2009/10. There were eight audit reports. One had received full assurance rating, five were rated satisfactory, one rated satisfactory/limited, and one rated limited. There were also four follow-up reports, three of which had received a satisfactory assurance rating, and one had received limited assurance. The committee concentrated on those audits where less than satisfactory assurance had been given.
Value for money in procurement
This audit had resulted in a limited assurance rating. In the absence of the auditor, the committee questioned the Organisational Change Group Manager who was involved in the procurement process for some contracts. The manager reported that the safeguards that Internal Audit had believed were not in place, had been in place for some time. The auditor’s report had not been conclusive in sections 9 and 10, suggesting that key performance indicators had not been included in one contract. The committee asked for Internal Audit to state whether it believed existing measures were adequate.
In section 13, the committee was concerned that the signed cash receipting software contract document appeared to be missing. This needed recovering, checking by Internal Audit, and filing securely.
The committee also discussed whether a legally binding contract could be made by email rather than by a signed and sealed contract document. It was concluded that the Head of Legal and Democratic Services should be asked to determine this. The committee also questioned the length of time taken to seal contracts. It was suggested that a time limit should be agreed with the Head of Legal and Democratic Services and monitored by the management team.
The committee considered that the implementation date was too late in section 13 relating to the contract management actions; councillors asked that an earlier date should be agreed between the service manager and the Head of Legal and Democratic Services.
In section 14, councillors questioned whether a project initiation document was completed and signed for the lean consultancy project, whether the documentation was compliant with the council’s methodology, and whether Internal Audit was satisfied with the outcome.
With regard to the tender process (section 16), members asked the officers to clarify whether there was a factual inaccuracy in the audit report about tender evaluation or whether there was a material disagreement between the auditor and the service manager. It was not satisfactory to report ambiguous or inconsistent statements in the audit report. Councillors also asked that the project managers should be reminded of the protocol of evidencing project board decisions, whether an actual board meeting was held, or a virtual meeting was held by email or other means.
Councillors queried whether the audit report reference to quality assurance standards in section 18 meant the ISO 9001 standard. The director agreed to find out.
The committee expressed its concern at the number of unanswered questions arising from this audit due to there being no auditor present at the meeting and asked that the questions were answered for the next committee meeting.
Housing and Council Tax benefits 2009/10
This audit resulted in a satisfactory/limited assurance rating. However, it was noted that there was no disagreement with the auditor’s recommendations. Councillors asked about the financial effect on the council of recovering outstanding benefits debt. The officers agreed to investigate the cost of debt recovery.
Although this audit achieved a satisfactory assurance rating, the committee questioned the recommendations in sections 2 and 6 of the auditor’s report. Councillors were unsure whether the process weaknesses that gave rise to the reconciliation discrepancies had been resolved or whether there was still a level of risk. Councillors sought an explanation of the current position and any actions planned to address any remaining weaknesses. It was reported that although running a separate system to manage the rent accounts had caused some issues, these were not significant but would continue to be monitored. The option to transfer back all housing debt to the financial management system was noted.
Bank reconciliation process 2009/10
This audit received a satisfactory assurance rating but councillors questioned the time lag in completing bank reconciliations. It was noted that the strategic director was working with Capita to reduce the delays but this work was competing with higher priorities. There would be a follow up audit to monitor actions.
General ledger 2009/10
Again, this audit received a satisfactory assurance rating but councillors questioned what action had been taken on the recommendation to stop former staff accessing the council’s systems. It was agreed that line managers needed to be reminded to properly comply with the existing staff exit procedures so that ex-staff were prevented from accessing council systems immediately they left the council’s employment.
Human resources follow-up audit 2008/09
The committee discussed the impending new regulations on criminal records bureau checks. The strategic director agreed to obtain reassurance that Human Resources would implement these.
The committee commented generally on the audit reports presented. Councillors requested that in future, where audit recommendations were not agreed by the service manager, there should be an additional response from Internal Audit.
(a) that the report be noted; and
(b) that the Audit Manager be requested to answer the outstanding questions in time for the next meeting of the committee.